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Delta about to offer one of the coolest upgrades yet

Delta Air Lines is cooking up what may be one of the most appealing flight upgrades yet: one that allows you to bag a commercial flight altogether and board a private jet. The new upgrade program, targeted at what Delta calls “high-value customers,” will cost $300 to $800, depending on destination. Beginning as soon as this week, passengers who have achieved elite or “medallion” status in Delta’s SkyMiles frequent-flyer program will be eligible for the upgrade offers. But officials stress that the initial number of private jet flights will be small and focused mainly at Delta’s East Coast hubs. “This is truly a groundbreaking new approach from both industry standpoints,” said James Murray, vice president of operations at Delta Private Jets (DPJ). “Nobody else can do what we’re talking about doing.” Delta’s decision to merge some of its commercial traffic with its 66-aircraft private jet unit shows the airline’s relentless focus on finding new revenue or squeezing more from existing customers, which is why carriers now appear to nickel- and-dime passengers for everything from snacks to movies once free of charge. Corporate travelers, who are less price- conscious because they book travel on their company’s credit card, represent the most attractive business for most large network carriers. The move reflects the airline industry’s keen focus on differentiating air travel and showering their most profitable customers with ever-higher levels of perks and amenities. For example, Delta, like most of its rivals, already drives lucrative passengers from one flight to another in luxury cars, allowing them to bypass the airport terminal gauntlet. (Delta uses Porsches, United goes with Mercedes, and American chose Cadillac.) Chauffeuring customers to a private jet is a logical brand extension. The upgrades could also help Delta quell one of the thorniest-and costliest-problems in private aviation, known as “empty legs,” or the need to reposition a jet without having a customer headed to that particular location. These inefficient flights account for roughly a third of all private jet flights, despite years of effort by the industry to minimize them. The advent of greater tracking data and new software analytics tools is likely to help private jet operators reduce their empty legs even further, said Erik Snell, president of Delta Private Jets. Initially, only Delta’s top customers-those at the highest “Diamond Medallion” level, which is met when people spend $15,000 at Delta and travel at least 125,000 miles or 140 flight segments per year-were going to be invited to purchase the upgrades. But the company has spent several months tweaking its model and decided to expand the pool of potential customers by opening it to people at the lowest elite tier, those who travel 25,000 miles or 30 segments annually, and who spend $3,000. Most of the upgrades will involve travel scheduled the next day, although Delta Private Jets said it would have some flights that offer travelers as much as 48 hours’ notice. Earlier this year, Delta Private Jets filed for a patent on the scheme of how to transfer passengers from a commercial carrier to a private jet operator. DPJ, a wholly owned subsidiary that calls itself the fourth-largest U.S. operator of private jet flights, has received regulatory approval to fly Delta passengers on 160 domestic routes, although it plans to begin mainly with flights among Atlanta, New York, and Cincinnati/Northern Kentucky International Airport, near the unit’s Erlanger (Ky.) headquarters. Over time, Delta Private Jets officials said the program might expand, potentially deploying part of the private jet fleet toward regular upgrades on certain routes, complementing Delta’s commercial service. And depending on passenger reception, Delta may begin marketing the option of a private jet upgrade as commonly as it touts airport lounges, first class, and other amenities for the most lucrative travelers. Still, “Delta operates a whole lot more flights than we have [private] airplanes,” Murray said, which means an upgrade to a private jet is likely to remain a niche offering. Yet, the “empty legs” problem of a vacant cabin won’t ever be eliminated. That’s one reason executives at the Delta unit were keen to see if they could match up routes with their mainline parent and harvest some of Delta’s most profitable customers-many of whom might not have flown privately before but could afford to. Across the private jet industry, a trip averages about $5,500 per hour, DPJ officials said. At an initial $300-$800 per flight, some Delta customers will find the upgrade an inexpensive way to sample the swank romance of private aviation. “The hope is that once someone flies private, and they don’t have to go through TSA, and they have the experience, then they may determine that they want to fly private more often,” said Cyril Turner, Delta Private Jets’ chief executive officer. Financially, the goal is “not necessarily to break even but to at least get some type of income” from the empty flights, Turner said in a June interview. The project has not been without hiccups. Delta Private Jets had hoped to launch the upgrades in early June but quickly found a need to tweak the initial $800 flat fee and to brief corporate travel managers about the initiative. Logistically, the operation faces a variety of hurdles beyond jet scheduling. Some corporate travel managers may not love the idea of employees spending more money at the last minute, or now having to devise a travel policy on who pays for it. The company also had to receive Department of Transportation approval for its plans; it is allowed to fly commercial passengers four days per week, Tuesday-Friday, and must submit for review new cities it wants to add. The upgrade program, for now, will include only domestic flights. (And miles junkies, take note: There’s no bonus in the upgrade, just the usual mileage accrual one would get taking the regular Delta flight.) DPJ offers some of its charter-jet customers a 10-hour guarantee, meaning that it will make a plane available anywhere in its network with that much notice. That provision complicates the ability to match a jet with Delta’s scheduled routes; some of the private jet fleet repositioning happens overnight, when Delta has few domestic flights. “If we lock up an airplane two days out, we can put ourselves in a potential bind as far as covering” the regular business, Murray said. In other cases, he said, “sometimes we have trips booked for specific airplanes and so we know exactly what that airplane is going to be doing in three days.” DPJ has been testing and revising its model in earnest since May. The company had a customer-who later changed his travel plans-booked for a June 12 flight from Atlanta to Cincinnati on an eight-passenger Cessna Citation X. The first flight is now expected to occur as early as July 29, although company officials said the timing remains uncertain. “As it stands right now,” said Murray, “there’s only a very small subset of the population that can afford to fly privately on a routine basis.”

students testing

George Washington U applicants no longer need to take admissions tests

WASHINGTON — George Washington University dropped its testing requirement for most freshman admissions Monday, becoming one of the largest and most prominent schools to declare that its applicants don’t have to take the SAT or ACT. The announcement from the private university in the nation’s capital reflects a growing belief in some college admission circles that standardized tests are a barrier to recruiting disadvantaged students. While that view is sharply debated, many say it is possible to assemble a strong class without forcing applicants to submit a score from tests that critics say are culturally biased and often fail to reflect academic potential. GWU administrators say they always seek well-rounded applicants by looking beyond test scores. But they have worried lately that anxiety about scores was leading some students to cross the school of their list. “Although we have long employed a holistic application review process, we had concerns that students who could be successful at GW felt discouraged from applying if their scores were not as strong as their high school performance,” said Dean of Admissions Karen Stroud Felton. “We want outstanding students from all over the world and from all different backgrounds — regardless of their standardized scores — to recognize GW as a place where they can thrive.” More than 125 private colleges and universities featured in U.S. News and World Report rankings now have test-optional admission policies, according to the National Center for Fair and Open Testing, or FairTest. Twenty have joined that group since January 2014, including Wesleyan University, ranked 15th among national liberal arts colleges. American University, also in the District of Columbia and ranked 71st on the magazine’s national university list, went test-optional a few years earlier. GWU ranks 54th on that list, and among private universities in the national top 100, GWU becomes the largest with test-optional admissions. It has 25,000 students, more than 10,000 of them undergraduates. Wake Forest University, 27th on the national university list, said it has recruited more minority students since going test-optional in 2009. “We find much more value in a student’s accomplishments in four years of high school than in four hours of Saturday testing,” said Martha Blevins Allman, dean of admissions at the private university in Winston-Salem, N.C. Some prominent schools require test scores but allow applicants to send results from Advanced Placement or International Baccalaureate exams instead of the SAT or ACT. Among these “test-flexible” schools are New York University, University of Rochester and Hamilton College. Some public universities — including Salisbury in Maryland and George Mason, Mary Washington, Christopher Newport, Old Dominion, Radford and Virginia Commonwealth in Virginia — will waive testing requirements for applicants with qualified grade-point averages. Others, such as the University of Texas, grant automatic admission to eligible in-state applicants who rank near the top of their high school class. Most of the nation’s selective schools continue to require the SAT or ACT. Millions of high school students each year take one exam or the other — often both, and sometimes repeatedly — on the presumption that admissions testing is an exasperating but essential ritual. The College Board is preparing to roll out a new SAT in March, the first revision since 2005, with the essay becoming optional and the perfect score reverting from 2400 to the iconic standard of 1600. The ACT, now more widely used than the SAT in the United States, has contracts with many states to test all 11th-graders in public schools. The test-preparation industry has grown worldwide as college-bound students seek every possible edge to get into ultra-selective schools. ACT President Jon L. Erickson dismissed any suggestion that there is a significant test-optional trend. “I’m not seeing it,” he said. Erickson said test scores, read alongside transcripts and other elements of an application package, have proven their value to generations of admissions officers. Asked about schools that have dropped testing requirements, Erickson said: “I have to question why having less information to make a decision is a good thing. To me, for a good decision, you want as much information as possible.” Jack Buckley, senior vice president for research at the College Board, said the SAT is “an essential part of the admissions process” for most colleges and universities. “Test-optional schools are our members and our partners,” Buckley said in a statement. “We respect the decisions they make about their admissions processes and we will continue to listen to our members, evolve our programs, and work to expand access to opportunity for all students.” Both admissions tests were originally conceived as measures to widen access to college, helping colleges sort students on individual merit rather than connections of family and privilege. Research has shown, though, that there are correlations between economic circumstances and test scores. The College Board and ACT also play a crucial role as gatherers and disseminators of data on potential applicants. Colleges purchase student names from the two nonprofit organizations (and other sources) every year as they begin mass marketing to identify prospects. Both organizations also seek to promote the ideal that students from any background can aim for college — and aim high. But GWU officials said that in recent years they have grown worried that their efforts to diversify were hitting obstacles. They feared that some students with strong records in high school were not applying because of a misguided perception that their scores weren’t good enough. In 2014, test scores for students in the middle of those offered admission to GWU ranged from 1890 to 2110 on the SAT, and 28 to 32 on the ACT, which has a top score of 36. A quarter of admitted students scored higher than those marks, and a quarter scored lower. But that range — known as “the middle half” — is a widely circulated statistic for selective colleges. Students whose scores fall short of the middle half might wonder about their chances, even if they have taken a rigorous path through high school, earned A’s and B’s, written fine essays and displayed strong personal qualities. “We want those students to have us on their radar, and not self-select out of the pool,” said Laurie Koehler, GWU’s senior associate provost for enrollment management. That is the primary reason for GWU’s policy shift, which takes effect for students seeking admission for fall 2016. The change was recommended by a task force on access and success that university President Steven Knapp formed in early 2014. Testing will still be required for home-schooled applicants, GWU said, as well as students from high schools that only provide narrative evaluation of students, college athletes and those applying for a seven-year program that leads to a combined bachelor’s/medical degree. Koehler said she expects many students will send in test scores despite the new option. Those scores, she said, will provide some insight. “I don’t think we’re trying to say that testing in itself is always bad or worthless,” she said. But Koehler said the value of scores, for an admissions officer seeking to gauge potential, pales in comparison to the value of other information. The best predictor of success in college, she said, “is high school performance as measured on a transcript, and in the context of the school.” George Washington University is simultaneously seeking to raise its national profile and diversify its student body. With a full price this fall of more than $62,000 for tuition, fees, room and board, GWU provides significant grants to students in financial need. About 14 percent of its undergraduates also receive need-based federal Pell grants. Ten percent are black or Hispanic. The test-optional movement has been building for years, often among liberal arts colleges. Bowdoin College in Maine dropped testing requirements in 1969. Bates College, also in Maine, abandoned its SAT requirement in 1984 and other testing mandates in 1990. A slew of other small schools eventually joined them, including Smith, Bryn Mawr, and College of the Holy Cross. In recent years, some national universities also have gone test-optional, according to FairTest, including George Mason in 2006, Worcester Polytechnic Institute in 2007, DePaul in 2011, Brandeis in 2013, Old Dominion and Temple in 2014 and Virginia Commonwealth this year. In all, FairTest counts more than 800 schools of all kinds — including tiny religious colleges and online for-profit educators — that admit substantial numbers of students without using SAT or ACT scores. Hampshire College went a step further last year, declaring itself “test-blind.” That means it won’t even look at SAT or ACT results. “Even if it’s a perfect score,” the college said. William C. Hiss, a former Bates admission dean, led a study of student outcomes at 33 test-optional colleges and universities for the National Association for College Admission Counseling. It found last year that there was no significant difference in college grades or graduation rates between those students who had submitted test scores with their applications and those who hadn’t. Hiss, a longtime test-optional advocate, said many admission chiefs told him the policies bolstered diversity. “They saw increases in applications from both low-income students and students of color,” Hiss said. Others are skeptical of that claim. Andrew Belasco, a college-admissions consultant in Georgia who studied more than 30 liberal arts colleges with test-optional policies, last year found no evidence that they had more success than schools with testing mandates at raising the share of students from poor or minority backgrounds. “If you’re really serious about attracting low-income students, you need to get serious about meeting those students where they are,” Belasco said. “You need to actually get out and recruit. You need to do more things in financial aid, making it easier for students to attend.”

Smartphone Medicine

Software turns smartphones into tools for medical research

SAN FRANCISCO — Jody Kearns doesn’t like to spend time obsessing about her Parkinson’s disease. The 56-year-old dietitian from Syracuse, New York, had to give up bicycling because the disorder affected her balance. But she still works, drives and tries to live a normal life. Yet since she enrolled in a clinical study that uses her iPhone to gather information about her condition, Kearns has been diligently taking a series of tests three times a day. She taps the phone’s screen in a certain pattern, records a spoken phrase and walks a short distance while the phone’s motion sensors measure her gait. “The thing with Parkinson’s disease is there’s not much you can do about it,” she said of the nervous-system disorder, which can be managed but has no cure. “So when I heard about this, I thought, ‘I can do this.‘” Smartphone apps are the latest tools to emerge from the intersection of health care and Silicon Valley, where tech companies are also working on new ways of bringing patients and doctors together online, applying massive computing power to analyze DNA and even developing ingestible “smart” pills for detecting cancer. More than 75,000 people have enrolled in health studies that use specialized iPhone apps, built with software Apple Inc. developed to help turn the popular smartphone into a research tool. Once enrolled, iPhone owners use the apps to submit data on a daily basis, by answering a few survey questions or using the iPhone’s built-in sensors to measure their symptoms. Scientists overseeing the studies say the apps could transform medical research by helping them collect information more frequently and from more people, across larger and more diverse regions, than they’re able to reach with traditional health studies. A smartphone “is a great platform for research,” said Dr. Michael McConnell, a Stanford University cardiologist, who’s using an app to study heart disease. “It’s one thing that people have with them every day.” While the studies are in early stages, researchers also say a smartphone’s microphone, motion sensors and touchscreen can take precise readings that, in some cases, may be more reliable than a doctor’s observations. These can be correlated with other health or fitness data and even environmental conditions, such as smog levels, based on the phone’s GPS locater. Others have had similar ideas. Google Inc. says it’s developing a health-tracking wristband specifically designed for medical studies. Researchers also have tried limited studies that gather data from apps on Android phones. But if smartphones hold great promise for medical research, experts say there are issues to consider when turning vast numbers of people into walking test subjects. The most important is safeguarding privacy and the data that’s collected, according to ethics experts. In addition, researchers say apps must be designed to ask questions that produce useful information, without overloading participants or making them lose interest after a few weeks. Study organizers also acknowledge that iPhone owners tend to be more affluent and not necessarily an accurate mirror of the world’s population. Apple had previously created software called HealthKit for apps that track iPhone owners’ health statistics and exercise habits. Senior Vice President Jeff Williams said the company wants to help scientists by creating additional software for more specialized apps, using the iPhone’s capabilities and vast user base — estimated at 70 million or more in North America alone. “This is advancing research and helping to democratize medicine,” Williams said in an interview. Apple launched its ResearchKit program in March with five apps to investigate Parkinson’s, asthma, heart disease, diabetes and breast cancer. A sixth app was released last month to collect information for a long-term health study of gays and lesbians by the University of California, San Francisco. Williams said more are being developed. For scientists, a smartphone app is a relatively inexpensive way to reach thousands of people living in different settings and geographic areas. Traditional studies may only draw a few hundred participants, said Dr. Ray Dorsey, a University of Rochester neurologist who’s leading the Parkinson’s app study called mPower. “Participating in clinical studies is often a burden,” he explained. “You have to live near where the study’s being conducted. You have to be able to take time off work and go in for frequent assessments.” Smartphones also offer the ability to collect precise readings, Dorsey added. One test in the Parkinson’s study measures the speed at which participants tap their fingers in a particular sequence on the iPhone’s touchscreen. Dorsey said that’s more objective than a process still used in clinics, where doctors watch patients tap their fingers and assign them a numerical score. Some apps rely on participants to provide data. Elizabeth Ortiz, a 48-year-old New York nurse with asthma, measures her lung power each day by breathing into an inexpensive plastic device. She types the results into the Asthma Health app, which also asks if she’s had difficulty breathing or sleeping, or taken medication that day. “I’m a Latina woman and there’s a high rate of asthma in my community,” said Ortiz, who said she already used her iPhone “constantly” for things like banking and email. “I figured that participating would help my family and friends, and anyone else who suffers from asthma.” None of the apps test experimental drugs or surgeries. Instead, they’re designed to explore such questions as how diseases develop or how sufferers respond to stress, exercise or standard treatment regimens. Stanford’s McConnell said he also wants to study the effect of giving participants feedback on their progress, or reminders about exercise and medication. In the future, researchers might be able to incorporate data from participants’ hospital records, said McConnell. But first, he added, they must build a track record of safeguarding data they collect. “We need to get to the stage where we’ve passed the privacy test and made sure that people feel comfortable with this.” Toward that end, the enrollment process for each app requires participants to read an explanation of how their information will be used, before giving formal consent. The studies all promise to meet federal health confidentiality rules and remove identifying information from other data that’s collected. Apple says it won’t have access to any data or use it for commercial purposes. Some studies will always require in-person interaction or supervision by a doctor, experts say. But by reaching more people and gathering more data, advocates say smartphone apps can help doctors answer more subtle questions about a disease. “Diseases like asthma are very complicated. They’re not caused by a single gene or environmental influence,” said Eric Schadt, a genomics professor who’s using an iPhone app to study asthma at New York’s Icahn School of Medicine at Mount Sinai. “The only hope you have of really going further in resolving this disease is for researchers to get to more people.”

El Nino

Worldwide strengthening El Nino giveth and taketh away

WASHINGTON — In California, they’re counting on it to end an historic drought; in Peru, they’ve already declared a pre-emptive emergency to prepare for devastating flooding. It’s both an economic stimulus and a recession-maker. And it’s likely to increase the price of coffee, chocolate and sugar. It’s El Nino — most likely, the largest in well over a decade, forecasters say. A lot more than mere weather, it affects lives and pocketbooks in different ways in different places. Every few years, the winds shift and the water in the Pacific Ocean gets warmer than usual. That water sloshes back and forth around the equator in the Pacific, interacts with the winds above and then changes weather worldwide. This is El Nino. Droughts are triggered in places like Australia and India, but elsewhere, droughts are quenched and floods replace them. The Pacific gets more hurricanes; the Atlantic fewer. Winter gets milder and wetter in much of the United States. The world warms, goosing Earth’s already rising thermometer from man-made climate change. Peruvian sailors named the formation El Nino — the (Christ) Child — because it was most noticeable around Christmas. An El Nino means the Pacific Ocean off Peru’s coast is warm, especially a huge patch 330 feet (100 meters) below the surface, and as it gets warmer and close to the surface, the weather “is just going to be a river falling from the sky,” said biophysicist Michael Ferrari, director of climate services for agriculture at the Colorado firm aWhere Inc. Around the world, crops fail in some places, thrive elsewhere. Commercial fishing shifts. More people die of flooding, fewer from freezing. Americans spend less on winter heating. The global economy shifts. “El Nino is not the end of the world so you don’t have to hide under the bed. The reality is that in the U.S. an El Nino can be a good thing,” said Mike Halpert, deputy director of the U.S. National Oceanic and Atmospheric Administration’s Climate Prediction Center. This El Nino officially started in March and keeps getting stronger. If current trends continue, it should officially be termed a strong El Nino early in August, peak sometime near the end of year and peter out sometime next spring. Meteorologists say it looks like the biggest such event since the fierce El Nino of 1997-1998. California mudslides notwithstanding, the U.S. economy benefited by nearly $22 billion from that El Nino, according to a 1999 study. That study found that 189 people were killed in the U.S, mainly from tornadoes linked to El Nino, but an estimated 850 lives were saved due to a milder winter. A United Nations-backed study said that El Nino cost Bolivia, Colombia, Ecuador, Peru and Venezuela nearly $11 billion. Flooding in Peru destroyed bridges, homes, hospitals and crops and left 354 dead and 112 missing, according to the Pan-American Health Organization. The mining industry in Peru and Chile was hammered as flooding hindered exports. Though this year’s El Nino is likely to be weaker than the 1997-1998 version, the economic impact may be greater because the world’s interconnected economy has changed with more vulnerable supply chains, said risk and climate expert Ferrari. Economic winners include the U.S., China, Mexico and Europe while India, Australia and Peru are among El Nino’s biggest losers. On average, a healthy El Nino can boost the U.S. economy by about 0.55 percent of Gross Domestic Product, which would translate more than $90 billion this year, an International Monetary Fund study calculated this spring. But it could also slice an entire percentage point off Indonesia’s GDP. Indonesia gets hit particularly hard because an expected El Nino drought affects the country’s mining, power, cocoa, and coffee industries, said IMF study co-author Kamiar Mohaddes, an economist at the University of Cambridge in London. The expected El Nino drought in parts of Australia has started and may trim as much as 1 percent off of the country’s GDP, said Andrew Watkins, supervisor of climate prediction services at the Australian Bureau of Meteorology. Tony Barnston, lead El Nino forecaster at the International Research Institute for Climate and Society at Columbia University, cautioned that while El Nino has predictable effects and this one is strong, what happens next is not exactly certain. But Peruvians are worried. Abraham Levy, director of Ambiental Andina, which advises businesses on meteorology- and hydrology-related issues, believes this El Nino could lead Peru into recession. Important export crops such as mangos and asparagus that grow in coastal valleys are already being adversely affected by the unseasonably high temperatures, said Levy. “The export mango crop has not yet flowered,” he said. “And if we don’t have flowers we don’t have fruit.” And then there’s the flooding. Peru declared a pre-emptive state of emergency this month for 14 of its 25 states, appropriating some $70 million to prepare. Hilopito Cruchaga, the civil defense director in Peru’s northern region of Piura, said authorities are clearing river beds of debris, reinforcing river banks with rock and fortifying reservoir walls. Sandbags and rocks are also being piled on some river banks. “If the sea stays this hot at the end of August I’m afraid we’re doomed,” he said.

National Business


Understanding gambling winnings and losses

You just won a jackpot on a slot machine! But before getting too excited let’s take a look at the tax consequences. Until Congress approves the changes proposed by the IRS regarding lowering the winnings reported to $600 from $1,200, winnings of $1,200 from slot machines and bingo are reported on a W2-G. This money must then be reported on line 21 of the 1040 as “Other Income.” Wait, you lost more than $3,000 all year at the casinos. Unless you can itemize your deductions, those losses are mute in offsetting the jackpot winnings. The “net income” is not what is reported on line 21, but rather, the gross of the winnings. In order to itemize for 2015 taxpayers who are single must have more than $6,300 in deductions to deduct gambling losses. Married filing jointly taxpayers must have more than $12,600 to deduct gambling losses. Head of Household taxpayers must have more than $9,250 to deduct gambling losses. If a taxpayer can itemize then the maximum amount reported on the Schedule A is the amount of losses up to the amount of the winnings. This means if you won $1,250 in a slot jackpot, the maximum amount of the $3,000 in losses that is reported is $1,250 on Schedule A. The remaining amount of losses don’t carry over to the next year, nor can they be deducted anywhere else on the tax return. If the proposed changes from the IRS are accepted by Congress and changes to the tax law occur, gamblers and casinos are in for more reporting requirements. The responses from the public heard at a public hearing on June 17 when the IRS opened up the proposed changes to the public were not in favor of the proposed changes. The proposed changes didn’t allow for any change to reporting the loss side of the winnings. This, in my opinion, isn’t a fair assessment of “Other Income.” If a taxpayer had to spend $3,000 to get $1,250 in winnings (for example) is it truly “Income?” Just as business income or capital gains allow for deductions or basis to be considered before reporting actual income, gambling winnings should have the same considerations. Taxpayers that enjoy gambling should make a call to their congressman to voice their opinion of the proposed changes. The IRS may propose a change, but Congress still has to approve it. Tracy Bunner is an enrolled agent and tax preparer with an office in Harrisville. She can be reached at 801-686-1995 or at


Congress pushes ahead on highway bill after Senate smackdown

WASHINGTON — Lawmakers are pushing forward on must-pass highway legislation after an amendment reviving the federal Export-Import Bank provoked a heated clash on the Senate floor. The amendment advanced over a procedural hurdle by a vote of 67-26 in an unusual Sunday session, and was likely to win approval Monday to be included on the highway bill. But that was only after senior Senate Republicans publicly rebuked Texas GOP Sen. Ted Cruz, who last week accused Senate Majority Leader Mitch McConnell of lying to him about whether there was a deal to allow the vote on the Export-Import Bank. Conservatives strongly oppose the bank, calling it corporate welfare, and are trying to ensure that it stays dead after congressional inaction allowed it to expire June 30. Three of the Senate’s highest-ranking Republicans rose after the Senate convened Sunday afternoon to counter the stunning floor speech Cruz gave on Friday in which he attacked McConnell, R-Ky. “Squabbling and sanctimony may be tolerated in other venues and perhaps on the campaign trail, but they have no place among colleagues in the United States Senate,” said Sen. Orrin Hatch, R-Utah, the Senate’s president pro tempore. Cruz is running for president. “Such misuses of the Senate floor must not be tolerated.” After Hatch spoke, Cruz rose to defend himself, asserting, “Speaking the truth about actions is entirely consistent with civility.” For his part, McConnell said that given support for the Export-Import Bank, despite his own opposition no “special deal” was needed to bring it to a vote. The bank is a federal agency that makes and guarantees loans to help foreign customers to buy U.S. goods. It’s been renewed in the past with little or no controversy, but in recent years conservatives have turned it into a rallying cry. This year, the billionaire GOP donor Koch brothers have made it a focus. The action came as the Senate tries to complete work on the highway bill ahead of a July 31 deadline. If Congress doesn’t act by then, states will lose money for highway and transit projects in the middle of the summer construction season. With the Export-Import Bank likely added, the highway legislation faces an uncertain future in the House, where there’s strong opposition to the bank as well as to the underlying highway measure. The Senate’s version of the highway bill, which is on track to pass later in the week, sets policy and authorizes transportation programs for six years, though with funding for only three of those years. The House has passed a five-month extension of transportation programs without the Export-Import Bank included. For the moment, leaders of both chambers are insisting that only their version of the legislation will fly. That leaves the ultimate outcome uncertain as the House enters its final week of work before Congress’ annual August vacation, with the Senate set to go out of session a week later. In a meeting Friday, McConnell told about 50 lobbyists and Senate aides that he doesn’t plan to take up the House’s five-month extension and that he wants the House to take up the Senate’s six-year bill even if it means keeping the House in session through next weekend, according to a transportation industry official and a Senate aide familiar with the meeting. McConnell, who said he has had conversations with House Speaker John Boehner about the transportation bill, also told the group there won’t be a tax reform bill this year. The Obama administration and some lawmakers in both parties had hoped to find more money to pay for a six-year transportation bill by taxing profits U.S. companies park overseas, and House leaders are pushing their highway bill extension to buy more time to work on that issue. The industry official and the Senate aide spoke on condition that they not be named because they weren’t authorized to speak publicly.


Giant leap for Smithsonian fundraising

WASHINGTON — Smithsonian officials are over the moon that they needed only five days to complete their first Kickstarter fundraising campaign — to conserve, digitize and display Neil Armstrong’s Apollo 11 spacesuit. The National Air and Space Museum reached its $500,000 goal Friday for the “Reboot the Suit” project, thanks to more than 6,200 backers who made donations ranging from $1 to $10,000. Because the online campaign continues through Aug. 19, museum officials have upped the goal to $700,000 and will use the additional money to preserve, digitize and display Alan Shepard’s Mercury spacesuit, which he wore in 1961 as the first American in space. Armstrong’s suit will be restored and displayed by July 2019, the 50th anniversary of the Apollo 11 moon landing. Both spacesuits will be featured in the Destination Moon exhibition the museum plans to open in about 2020. “It’s a little overwhelming,” Yoon Lee, the Smithsonian’s director of digital philanthropy, said about public reaction to the campaign. “We thought we could do it, get to our goal, but we didn’t think it would be so fast. We’ve been racing to keep up.” Elizabeth Ngonzi, a professor at New York University’s George H. Heyman Jr. Center for Philanthropy and Fundraising, called the project innovative. “It’s pretty genius,” Ngonzi said. “Part of it is a PR move. It helps them connect to the public. It’s a staid, established brand, and if you want to revive it, this gets you in front of people.” Like other Kickstarter projects, the campaign offers a variety of rewards to “backers” who make pledges. The money is paid only if the campaign is successful. After Kickstarter’s fees, the museum will receive about 90 percent of total donations, Lee said. Armstrong’s spacesuit is the largest project a cultural organization has launched on Kickstarter, Lee said. It is the first in a year-long partnership between the Smithsonian and Kickstarter. Upcoming initiatives will come from different Smithsonian facilities. The online project is part of the larger $1.5 billion fundraising effort underway at the Smithsonian, an organization of 19 museums and research centers that receives about $800 million in federal aid annually. The Smithsonian’s annual budget is about $1.3 billion. “One of our goals in that campaign is to reach people everywhere,” Lee said. “This partnership makes wonderful sense in that respect.” The campaign got the attention of Del. Eleanor Holmes Norton, D-D.C, who recently reintroduced a bill to change the governance of the Smithsonian Institution to make it easier for it to raise private donations. “The notion that you’d have to go around begging for money to restore this historical object makes my point,” she said. The institution’s 17-member Board of Regents would be expanded to 21, all private citizens. Currently, the board is made up of nine private citizens, six members of Congress, the vice president of the United States and the chief justice of the Supreme Court. In her proposed reorganization, House and Senate leaders would each nominate 12 citizens, and the president of the United States would chose 21 from those 24 candidates. “To have the board dominated by public officials ties the hands of the Smithsonian behind its back,” she said. “Federal funds can’t cover all the costs, and they need to do more fundraising.” But, Ngonzi said, the Smithsonian’s entry into online crowdfunding should be seen as innovative rather than desperate. Established organizations that have a significant pipeline to donors still need to find new ones, she said. Kickstarter helps them get their message to people who are not in their database but who are probably aware of their missions. “You’re leaving money on the table when you don’t activate people who are involved,” she said. “You start connecting to young donors, who eventually become older donors.” “This is low-hanging fruit,” she said. “It’s a way to activate people who are interested.”

Indonesia Jamaica Deep Seabed Mining

Deep-sea mining looms as UN body issues contracts

KINGSTON, Jamaica — The deep oceans span more than half the globe and their frigid depths have long been known to contain vast, untapped deposits of prized minerals. These treasures of the abyss, however, have always been out of reach to miners. But now, the era of deep seabed mining appears to be dawning fueled by technological advances in robotics and dwindling land-based deposits. Rising demand for copper, cobalt, gold and the rare-earth elements vital in manufacturing smartphones and other high-tech products is causing a prospecting rush to the dark seafloor thousands of meters (yards) beneath the waves. With authorities at the Jamaica-based International Seabed Authority issuing exploration contracts, alarmed conservationists are warning that the deep ocean’s fragile biodiversity must be protected and not nearly enough is known about the risks of extracting minerals from seabeds. “The pace of activity has increased dramatically over the last five years,” said Michael Lodge, deputy secretary-general of the obscure U.N. body in Kingston that acts as a global steward of the deep seafloor and is tasked with regulating this new mining frontier. “We’re seeing the private sector invest in a big way.” The U.N. agency, known by its initials ISA, presides over seabed outside the exclusive territorial waters of individual countries. So far, it has issued 27 exploration contracts, the large majority of them since 2011. The 15-year contracts allow for mineral prospecting on over 1 million square kilometers (over 390,000 sq. miles) of seabed in the Pacific, Atlantic and Indian Oceans. Governments and private companies have been moving so rapidly to stake claims and assess deposits that insiders forecast that commercial deep-sea mining could start within the next five years using robotic collectors equipped with cameras and sonar sensors along with pipe systems that can siphon crushed minerals to ships. During a gathering this month in Jamaica of representatives from nearly 170 member states, ISA has started drafting a framework to regulate commercial exploitation of seafloor metals and minerals. The session ended Friday. A group of international scientists, in a July 9 article in the journal Science, urged ISA to temporarily halt authorization of new mining contracts until networks of “marine protected areas” are established around areas targeted for mining. “We owe it to future generations to ensure that we think before we act and gain a thorough understanding of the potential impacts of mining in the deep sea before any mining is permitted,” said Matthew Gianni, co-founder of the Deep Sea Conservation Coalition, which sent observers to ISA’s 21st session in Kingston. But despite the warnings, in recent days ISA authorized its latest exploration contract, a 72,745 square kilometer (28,087 sq. mile) permit in the Pacific to China Minmetals Corp., sponsored by Beijing. China now has the most permits from the U.N. body with four. ISA was launched in 1994 and operates under the U.N. Convention on the Law of the Sea. The only major maritime power that has not ratified the convention is the United States, where lawmakers have argued it could impinge on U.S. economic and military sovereignty. The Department of the Interior has granted exploration licenses in the Pacific to Lockheed Martin Corp., a U.S. company that has also partnered with the United Kingdom, an ISA member, by setting up a deep-sea mining subsidiary there. So far, most of ISA’s contracts have been issued for the deep abyssal plains of the Clarion-Clipperton Fracture Zone, a sprawling area of the Pacific Ocean off Mexico and the U.S. At depths of 4,000 to 6,000 meters, it is known to be rich in nodules containing copper, cobalt, manganese and significant concentrations of rare-earth elements. As part of an environmental plan, ISA has set aside nine areas in this zone, prohibiting them to contractors. Other coveted exploration areas contain copper-rich sulphides formed around hydrothermal vents and black cobalt crusts created along the slopes of seamounts and volcanic mountain ranges. These biologically complex areas are found in the Western Pacific, Atlantic and Indian Oceans. ISA literature estimates that one site could provide up to 25 percent of the annual global market for cobalt. “The concentrations of minerals that you find in the seabed are very much richer than what’s left on land. So demand is only going to increase,” Lodge said. Douglas McCauley, an ecologist and conservation biologist at the University of California, Santa Barbara, said seabed mining and other industrial activities like ocean-based power generation and farming indicates that mankind is on the cusp of launching a “marine industrial revolution.” Current proposals for the oceans over the next several decades “look uncomfortably similar to what we did to land in the 1700s and 1800s,” he said, adding that the onset of the land-based industrialization was associated with a spike in animal extinction rates. But there are basic things humanity can do to approach seabed mining intelligently, he said. First, learn what biodiversity is down there before we mine. Second, go slowly on exploitation contracts and study the impacts of this mining as it is happening. Third, set up systems of protected areas before, not after, mining starts. “The terrestrial industrial revolution happened before we had the tools to manage goals for development and goals for sustaining biodiversity. You can’t really blame people in the 1700s for the damage they did to the environment...” he said. “But we certainly are to blame if we don’t do seabed mining properly.” David McFadden on Twitter: