Oil and Gas Regulatory Push Coming from Obama Administration

Oil and Gas Regulatory Push Coming from Obama Administration
Methane Emissions, Fracking, Arctic Drilling, Rail Tanker Cars All Would Be Subject to New Rules

Amy Harder, The Wall Street Journal
Dec. 29, 2014 4:54 p.m. ET

The Obama administration is planning to release in the coming months a series of regulations on the oil and natural gas industry, a response to the nation’s energy boom that also is aimed at burnishing President Barack Obama ’s environmental legacy in his final two years.

The coming rules—at least nine in total—would include the first-ever federal standards addressing methane emissions, stricter controls on hydraulic fracturing, drilling requirements in the Arctic, new rules governing oil shipped by trains and tougher standards on offshore drilling technology.

The repercussions for the industry could be higher operating costs and fewer incentives to drill on public lands. Mr. Obama and his environmental backers say new regulations are needed to address the impacts of the surge in oil and gas drilling and production.

“The large number of imminent regulations may be a sign that the White House is greening up its oil-and-gas policy,” said Kevin Book, managing director of Clearview Energy Partners, a nonpartisan energy research firm that tracks federal regulations. “Fracking produced numerous regulatory responses at multiple levels, and a lot of the federal rules have been pending for a long time.”

In its first six years, the administration released very few regulations directly affecting the oil-and-gas industry and instead rolled out several significant rules aimed at cutting air pollution from the coal and electric-utility sectors. Some of the coming rules have been in the works for months or even years, and others are required by current laws or court decisions.

The U.S. is now the world’s largest natural-gas producer and is on track to become the biggest oil producer in 2015. Since 2008, U.S. oil production has surged 74% to 8.8 million barrels a day, while natural-gas production climbed 22% to 2.7 trillion cubic feet in September, according to the U.S. Energy Information Administration. Oil and gas production on public lands has declined 16% and 24%, respectively, over the same period, according to EIA data. Several states have enacted regulations in response to the nation’s increased production, but the federal government hasn’t.

“I think it is fair to say that given the changes in technology and the significant changes that we’ve seen in terms of domestic oil-and-gas production, there is a need to keep that regulatory process up-to-date,” said Heather Zichal, an energy consultant who was a top energy and climate adviser in the White House until October 2013.

The White House and energy companies have clashed over proposed fossil-fuel regulations, particularly a rule proposed last spring by the Environmental Protection Agency aimed at cutting carbon emissions from the nation’s power plants. The coming oil-and-gas regulations are likely to intensify that tension.

White House counselor John Podesta said the administration’s plans are part of a continuing effort to move to cleaner sources of power while creating jobs and preserving energy security. “Across the federal government, we’ve taken steps to develop our oil-and-gas resources safely and responsibly, including by partnering with industry and working with states,” he said via email.

One of the most-watched actions is what the EPA does about methane emissions from oil and natural gas drilling operations. The agency is expected to announce in January whether it will expand an existing regulation to further regulate methane indirectly, which is the industry’s preferred option, or begin regulating methane emissions directly, a broader regulatory approach environmental groups are pushing.

Industry executives cite the months long drop in oil prices as an argument against the methane regulations. Greg Guidry, an executive vice president at Shell, said at an event in Washington recently that he doesn’t want EPA to “impose unnecessary costs and burdens on an industry challenged now by a sustained low-price environment.”

The Interior Department, which has jurisdiction over public lands, also is planning to propose a rule in April that would set a standard for how much methane companies can either vent into the atmosphere or flare off when drilling for oil and natural gas, whose main component is methane.

Janet McCabe, the acting assistant administrator for air at EPA, said recently that cutting methane emissions is an important part of the climate agenda Mr. Obama unveiled in June 2013 and that the administration is working to avoid any duplicative regulatory efforts.

“We work closely with our partners at the Interior Department to make sure we’re not walking into situations…where we have inconsistent expectations, duplicative expectations,” said Ms. McCabe, noting that the regulations are being prompted by “an increasing awareness and concern of the role that methane emissions are playing in global climate concerns.”

The Transportation Department is expected to issue a final rule by March requiring tougher standards on oil shipped by rail, including phasing out older railcars within two years.

Thanks to the boom in oil production and lack of pipeline infrastructure, oil shipped by rail has risen from almost nothing in 2005 to more than 400,000 tank cars of crude oil in 2013, according to the Association of American Railroads. Through the first half of this year, shipments rose an additional 11.7%.

The rule, which the department proposed in draft form earlier this year, followed a series of fiery oil-train accidents that began in July 2013 with a derailment and explosion in Lac-Mégantic, Quebec, which killed 47 people. Both the oil and rail industries say they would need more than two years to comply with the rule.

Jack Gerard, president and CEO of the American Petroleum Institute, whose organization is among those calling for more time to comply with the pending rail rule, said the upshot of several of these rules is that Mr. Obama is following through on his pledge to act alone without Congress, a move he opposes.

“There’s this attitude that if the people and the democratically elected institutions don’t agree, we’re going to go it alone,” Mr. Gerard said in an interview. “I think that attitude is permeating some of the regulatory bodies.”

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Still more politicized pseudo-science?

Remember how radical environmentalists pressured governments to ban DDT and Alar? Now it looks like some European scientists conspired to pave the way for a World Wildlife Fund campaign to ban neonicotinoids. Numerous farmers now rely on these novel pesticides to replace far more toxic crop protection chemicals that they previously used. But a recently leaked memorandum summarizes the scientists’ discussion about coordinating the publication of papers in respected scientific journals, to support their claim that neonics harm honeybees. “If we are successful in getting these two papers published,” the memo states, it will be much harder for politicians to resist calls for a ban.

Extensive studies show that neonics are safe for bees – and other research has identified problems that truly are afflicting these busy pollinators. We need to let real science do its job, and stop trying to short-circuit the process with politicized papers and anti-pesticide campaigns. Otherwise, bee mortality problems are likely to spread.

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Still more politicized pseudo-science?

The neonics and honeybees saga takes interesting, potentially fraudulent turn

Paul Driessen

Widening efforts to blame neonicotinoid pesticides for honeybee “colony collapse disorder” and other “beepocalypse” problems have taken a fascinating turn.

Insisting that scientific evidence shows a clear link between neonics and honeybee population declines, EU anti-insecticide campaigners persuaded the European Union to impose a two-year ban on using the chemicals. Farm organizations and the Union’s Environment, Food and Rural Affairs Department unsuccessfully opposed the ban, arguing that evidence for a link is not persuasive, and actual field studies in Canada and elsewhere have found little risk to bees from the pesticides.

Then this year’s canola (rapeseed) crop suffered serious losses of 30-50 percent, due to rampaging flea beetles. Over 44,000 acres (18,000 hectares) were declared a total loss. Euro farmers blamed the ban.

Now it appears that the campaign against these newer, safer pesticides – and the scientific papers that supposedly justify the ban – were all part of a rigged, carefully orchestrated environmentalist strategy.

A recently leaked memorandum, dated June 14, 2010, summarizes a discussion earlier that month among four European scientists who wanted to block neonic use. The memo says the four agreed to find prominent authors who could write scientific papers and coordinate their publication in respected journals, so as to “obtain the necessary policy change to have these pesticides banned.”

“If we are successful in getting these two papers published,” the memo continues, “there will be enormous impact, and a campaign led by WWF etc could be launched right away. It will be much harder for politicians to ignore a research paper and a policy forum paper” in a major scientific journal. Initial papers would demonstrate that neonics adversely affect bees, other insects, birds and other species; they would be written by a carefully selected primary author and a team of scientists from around the world. Additional papers would be posted online to support these documents – and a separate paper would simultaneously call for a ban on the sale and use of neonicotinoids.

(The WWF is the activist group World Wildlife Fund or World Wide Fund for Nature.)

One meeting attendee was Piet Wit, chairman of the ecosystems management commission of the environmentalist organization International Union for Conservation of Nature. Another was Maarten Bijleveld van Lexmond, who became chairman of the IUCN’s Task Force on Systemic Pesticides, which was inaugurated in March 2011, just after the European Union agreed to finance the Task Force to the tune of €431,337 ($540,000). Vouching for the Task Force as an “independent and unbiased” scientific “advisory” group was the same Dr. Maarten Bijleveld, who is also a founding member of the WWF’s Netherlands branch and an executive officer of the IUCN’s environmental committee.

Further underscoring the “independent” nature of these organizations, the EU awarded the IUCN €24,014,125 ($30,000,000) between 2007 and 2013. Moreover, IUCN task force membership is by invitation only – making it easier to implement the Systemic Pesticides Task Force’s stated purpose: to “bring together the scientific evidence needed to underpin action on neonicotinoid pesticides.”

The entire operation is odorously reminiscent of ClimateGate orchestration of alarmist research and banning of studies questioning “dangerous manmade climate change” assertions, and the Environmental Protection Agency’s 1972 DDT ban, regarding which then-EPA Administrator William Ruckelshaus later admitted that he had not attended a single minute of his own task force’s lengthy hearings or read a single page of its findings, which concluded that the insecticide was not dangerous to humans or most wildlife.

The IUCN/WWF campaign also recalls the equally well coordinated effort by Fenton Communications, CBS “60 Minutes” and the Natural Resources Defense Council to ban Alar (a chemical used to keep apples ripening longer on trees), in a way that would channel millions of dollars to the NRDC. It reminds me of former Environmental Defense Fund senior scientist Charles Wurster’s assertion that, “If the environmentalists win on DDT, they will achieve a level of authority they never had before.”

Never mind that the Alar scam sent many family apple orchards into bankruptcy – or that millions of African and Asian parents and children have died from malaria because radical greens have made DDT largely unavailable even for disease control. For them, humanitarian concerns rarely enter the discussion.

As science writer Hank Campbell observes, all these campaigns reflect proven strategies “to manipulate science to achieve a political goal.” They follow the Saul Alinsky/Big Green script summarized by Madeleine Cosman: Select and vilify a target. Devise a “scientific study” that predicts a public health disaster. Release it to the media, before legitimate scientists can analyze and criticize it. Generate emotional headlines and public reactions. Develop a government “solution,” and intimidate legislatures or government regulators to impose it. Coerce manufacturers to stop making and selling the product.

Environmental pressure groups have repeatedly and successfully employed these steps.

In a recent speech, Harvard School of Public Health Professor Chensheng Lu claimed that his “Harvard Study” clearly demonstrated that neonics “are highly likely to be responsible for triggering Colony Collapse Disorder.” However, pesticide expert and professional pest exterminator Rich Kozlovich says the vast majority of scientists who study bees for a living vigorously disagree. They cite multiple problems, including the fact that small bee populations were fed “astronomical” levels of insecticide-laced corn syrup, and the colonies examined for Lu’s paper did not even exhibit CCD symptoms.

President Obama has nevertheless relied heavily on all this pseudo-science, to support his June 2014 memorandum instructing relevant U.S. agencies “to develop a plan for protecting pollinators such as honey bees …in response to mounting concerns about [their] dwindling populations on American crops.” The “serious” problem, Mr. Obama insists, “requires immediate attention.”

He is playing his role in the Big Green script but, as my previous articles have noted (here, here and here), nothing in honest, actual science supports his call for yet another Executive Branch end-run around the Legislative Branch and a proper vetting of what we do know about neonics and honeybee problems.

Neonics are vital for numerous crops: canola, soybeans, wheat, winter squash, citrus groves and others.

Derived from a synthetic form of nicotine and often applied to seeds, “neonicotinoids” are incorporated into plants to defend them against pests. This allows growers to be much more targeted in killing crop-threatening insects: only those that actually feed on the plants are affected. This approach (or spraying) also means growers can successfully grow crops with far fewer large-scale insecticide applications, and dramatically reduce reliance on more toxic pesticides that do harm wildlife, including bees. Real-world field studies have shown that bees collecting pollen from plants treated with neonics are not harmed.

Other research has identified serious problems that truly are afflicting bees in Canada, the United States, Europe and elsewhere. Varroa mites carry at least 19 bee viruses and diseases – and parasitic phorid flies, Nosema intestinal fungi and the tobacco ringspot virus also cause significant colony losses. Beekeepers have accidentally killed entire hives, while trying to address such problems.

Colony Collapse Disorder has shown up from time to time for centuries. A hundred years ago it was called the “disappearing disease.” It now seems to be ebbing, and bee and beehive numbers are climbing.

We need to let real science do its job, and stop jumping to conclusions or short-circuiting the process with politicized papers, anti-neonic campaigns and presidential memorandums. We need answers, not scapegoats. Otherwise, bee mortality problems are likely to spread, go untreated and get even worse, while neonic bans cause widespread crop failures and huge financial losses for farmers.

Paul Driessen is senior policy analyst for the Committee For A Constructive Tomorrow (www.CFACT.org), author of Eco-Imperialism: Green power – Black death and coauthor of Cracking Big Green: To save the world from the save-the-earth money machine.

Sierra Club Canada Foundation has been sent a Letter from Friends of Science Requesting Retraction of Climate Change Billboard Blog

Sierra Club Canada Foundation has been sent a Letter from Friends of Science Requesting Retraction of Climate Change Billboard Blog

In response to the Friends of Science climate change billboard campaign, the Sierra Club Canada Foundation published a blog piece on December 4, 2014 making false claims about the Friends of Science funding and inciting followers to join in an on-line email campaign against the billboard company. Friends of Science says this challenges their Canadian Charter Right of Freedom of Speech and unfairly harasses an innocent business operation, as well as defying the Sierra Club’s own stated mandate.

A satirical commentary about the Sierra Club Canada Foundation’s critique of Friends of Science Society’s climate change billboard that was published in the National Post Dec. 5, 2014, sub-titled “Sierra Club Finds a New Enemy in Global Plot Against Truth” has ignited an on-line firestorm of controversy in Canada over
Freedom of Speech and climate change.

National Post author Kelly McParland points to the contradictory statements of Sierra Club Canada Foundation’s National Program Director, published Dec. 4, 2014 in an online blog:

“Free speech is the right to express a point of view – a right I will rely on, and defend, every day.”

Not, apparently for Friends of Science. Sierra Club Canada Foundation’s National Program Director claims the billboard that states “The Sun is the main driver of climate change. Not You. Not CO2.” is ‘disinformation’ and asks followers to demand they be taken down.

Today, Friends of Science Society have sent a letter to the Sierra Club Canada Foundation demanding a retraction of the blog and an apology.

Friends of Science point out that even the IPCC agrees with them “The Sun powers Earth’s climate.” Friends of Science resident science adviser, Norm Kalmanovitch, P. Geoph, says “We are setting a proper context for Canadians to have a thoughtful and rational discussion about climate change issues and policies. Sierra Club Canada Foundation is trying to prevent that.”

Kalmanovitch points to both the NCDC and HadCRUT4 global temperature datasets used by the IPCC. “There is negative correlation of global temperatures with CO2 which means that since 2002, CO2 definitely does not drive a global temperature increase,” says Kalmanovitch.

Kalmanovitch goes on to say, “When the current global cooling trend began in 2002 it pushed the statistical end of global warming back to between 1997 and 1995, depending on the dataset used. This is why it is a perfectly valid statement to claim (as we do on one billboard) that global warming has stopped naturally for more than 16 years despite a rise in carbon dioxide.”

Kalmanovitch also refers to a graph of solar irradiance from the the World Radiation Center in Davos,

“There is also a drop of 0.8W/m2 in total solar irradiance between the peak of solar cycle 23 in 2001 and the peak of solar cycle 24 in 2014 which explains the global cooling since 2002,” he says. “This drop cannot be explained by the 9 billion tonne increase in emissions that took place between 2002 and today. Surely this is important information for taxpayers and policy makers.”

Friends of Science object to the email campaign Sierra Club Canada Foundation has initiated against the company that accepted its billboards as nothing more than bullying and intimidation against an innocent third
party, and not in keeping with Canada’s Charter Right of Freedom of Speech and Expression or fair business

This type of eco-authoritarianism was also the subject of an Oct. 9, 2014 column by Martin W. Lewis, author and senior lecturer at Stanford University, in Geo-currents. Lewis deconstructs the climate catastrophe pronouncements of Naomi Oreskes and Erik Conway’s recent book.

Lewis writes an atypical polemic commentary noting that “.. climate activism seems to be veering in an
unabashedly authoritarian direction. In such a heated atmosphere, even handed positions are at the risk of being flooded out by a rising sea of mutual invective and misinformation.”

“We too are looking for a rational, civil, evidence-based debate on climate change science and policies, “says Kalmanovitch. “Freedom of speech is imperative in a democracy and for scientific inquiry.”

Friends of Science have spent a decade reviewing a broad spectrum of literature on climate change and have concluded the sun is the main driver of climate change, not carbon dioxide (CO2). The core group of the Friends of Science is made up of a growing group of earth, atmospheric, astrophysical scientists and engineers who volunteer their time and resources to educate the public.

Friends of Science Society
P.O. Box 23167, Mission P.O.
Calgary, Alberta
Canada T2S 3B1
Toll-free Telephone: 1-888-789-9597
Web: friendsofscience.org
E-mail: contact(at)friendsofscience(dot)org

More subsidies for big wind

By Robert Bryce

If anyone needed proof that subsidy-dependent businesses will always seek more subsidies, look no further than the U.S. wind industry. On Wednesday, the wind sector won a vote in the House on a tax bill that includes a one-year extension of the production tax credit (PTC), which gives wind companies 2.3 cents for every kilowatt-hour of electricity they produce. The companies can collect that subsidy for a decade after they are deemed eligible.


The extension of the PTC was part of a bill that contained more than 50 tax breaks and subsidies that will cost taxpayers more than $40 billion. The portion attributable to the wind industry: about $6.3 billion. It appears that the Senate will pass the bill and President Obama will sign it into law. Thus the wind industry, which has been getting subsidies (with a few short interruptions) since 1992, will continue feeding at the trough.

If there was any doubt that the wind industry needs subsidies, look at the statement put out on Tuesday by the American Wind Energy Association, the sector’s main lobbying group. AWEA said that after the PTC expired in 2013, “new wind installations came to a halt, resulting in a 92 percent drop in new wind projects.”
Of course, rent-seeking entities love to claim that their pet projects deserve subsidies because they will create jobs. Indeed, the phrase “create jobs” appears twice in a one-page letter that was sent to leaders of Congress last month imploring them to extend the PTC. The letter was signed by AWEA and some 450 organizations, including the usual environmental groups — the Sierra Club, Clean Water Action, the National Wildlife Federation, and the Wilderness Society — as well as a host of major corporations. Among them: NextEra Energy, one of the world’s largest wind-energy producers. I wrote about NextEra last year in these pages after the company filed a SLAPP suit in Canada against Ontario anti-wind activist Esther Wrightman. (Here’s a link. Wrightman, by the way, has since moved out of Ontario, and the project she was fighting, NextEra’s Adelaide Wind Energy Centre, has gone forward.) Others that signed the subsidy-seeking letter included Siemens Corporation, E.On, and Nucor Corporation, which is one of America’s biggest steel producers.

AWEA claims that the wind industry supports 73,000 jobs. But how much do those jobs cost taxpayers?

Earlier this year, Susan Combs, the Texas comptroller of public accounts, came up with an estimate. She reported that each wind-related job in the Lone Star State (which has more wind-energy capacity than any other state) costs the state’s taxpayers about $1.7 million.

That’s an increase over what Combs found back in December 2010, when she reported that each wind-related job was costing taxpayers $1.6 million. In an August op-ed published at Economics21, Combs said that “instead of generating jobs and providing a reliable and consistent energy source, wind projects just generate higher costs.”

Perhaps more remarkable than the high cost of wind-energy jobs is the fact that the U.S. is continuing to subsidize wind energy at a time when AWEA itself is claiming major reductions in cost and European countries are slashing those very same subsidies.

In a press release issued last month, the lobby group declared that the cost of wind energy has “dropped by more than half in the last five years.” Furthermore, last month an AWEA spokesperson boasted to the New York Times that some wind projects are “coming in below the cost of even existing generation sources.” That same November 23 story, “Solar and Wind Energy Start to Win on Price vs. Conventional Fuels,” quoted Jonathan Mir, a managing director at the Wall Street firm Lazard, who said that the price of electricity that wind developers need to make money is now “essentially competitive with what would otherwise be had from newly constructed conventional generation.”

Mir and his colleagues at Lazard estimated that production of wind energy, without subsidies, now costs about 3.7 cents per kilowatt-hour, less than what they found for the same amount of electricity produced from natural gas (6.1 cents) and coal (6.6 cents). So if Lazard is correct and it’s cheaper to produce electricity from the wind than from other sources, why does the wind industry need subsidies?

That’s a particularly relevant question given that European countries are slashing subsidies for renewables. In July, Germany reduced subsidies for wind and solar by about 25 percent. On December 2, the Financial Times reported that an offshore wind farm planned for Northern Ireland has been “scrapped” owing to reductions in the subsidies paid for such projects.

To be sure, the ongoing battles over wind projects go far beyond the issue of subsidies. Citizens and environmental groups (commendably among them is the American Bird Conservancy) in the U.S. and Canada and across Europe are fighting wind-energy sprawl based on a variety of concerns, including destruction of scenic landscapes, the turbines’ deadly effect on bats and birds, and the irritating noise they produce.

But it’s the ongoing subsidies that really annoy Lisa Linowes, one of America’s most prominent critics of the wind industry. Linowes, who lives in Lyman, N.H., is the executive director of The WindAction Group as well as the publisher of the website windaction.org. Asked on Thursday about the vote to extend the PTC, she replied, “We thought the Republicans would have the stomach to stop this.”

— Robert Bryce is a senior fellow at the Manhattan Institute. His latest book, Smaller Faster Lighter Denser Cheaper: How Innovation Keeps Proving the Catastrophists Wrong, was published in May by PublicAffairs.

Professor Tribe Takes Obama to School

The liberal lion blasts the EPA’s climate rule as an illegal power grab.

WSJ Dec. 5, 2014 7:01 p.m. ET

In his Harvard days, Barack Obama studied under law professor Laurence Tribe. Perhaps the future President spent too much time at the law review and missed the part about limited powers. We say that because Professor Tribe delivered a constitutional rebuke this week to the Obama Administration that is remarkable coming from a titan of the liberal professoriate.

Mr. Tribe joined with the world’s largest private coal company, Peabody Energy , to criticize the “executive overreach” of the Environmental Protection Agency’s proposed rule to regulate carbon emissions from existing power plants. In joint comments filed with the EPA, the professor accuses the agency of abusing statutory law, violating the Constitution’s Article I, Article II, the separation of powers, the Tenth and Fifth Amendments, and in general displaying contempt for the law.

The Clean Air Act doesn’t give the Administration the authority the EPA claims to impose its climate crackdown on existing power plants by effectively eradicating coal power. The EPA instead uses—in Mr. Tribe’s words—“a hitherto obscure provision” of the Clean Air Act, known as Section 111, to justify its actions. Such legal scavenging is a characteristic of this Administration, and rarely has it been so thoroughly dismantled.

“The Proposed rule rests on a fatally flawed interpretation of Section 111. According to EPA . . . Congress effectively created two different versions of Section 111, and the agency should be allowed to pick and choose which version it wishes to enforce,” writes Mr. Tribe. “According to EPA, since 1990 the U.S. Code has reflected the wrong version of Section 111, and EPA has discovered a mistake [made by Congress]. According to EPA, both the D.C. Circuit and the U.S. Supreme Court have previously misinterpreted Section 111. According to EPA, the two different versions of Section 111 have created ‘ambiguity’ triggering deference to the agency’s [interpretation]. Every part of this narrative is flawed.”

We quote Mr. Tribe at length because the Administration likes to dismiss concerns about its extralegal exertions as partisan or political. But Mr. Tribe shows that there are genuine issues about the law and democratic process at stake.

He writes that even if EPA’s theory of two versions of Section 111 were correct, the agency’s “claim that it is entitled to pick and choose which version it prefers represents an attempt to seize lawmaking power that belongs to Congress. Under Article I, Article II, and the separation of powers, EPA lacks the ability to make law.” Mr. Tribe adds, icily, that a “presidential speech” is insufficient to claim such authority.

The liberal icon also explains how the EPA rule likely violates the Fifth Amendment’s Takings Clause with its “palpable unfairness of imposing all the costs on a small subset of entities [coal] within the agency’s cross-hairs. The Proposed Rule represents a radical shift in federal policy that upsets settled, investment-backed expectations, with no attempt by EPA to quantify the climate or environmental benefits from the Proposed Rule.” Mr. Tribe urges Democrats and Republicans to resist the rule and “stand in strong support of the rule of law.”

None of this is likely to deter the EPA, which is determined to impose its climate agenda without having passed a single new act of Congress. But once the agency issues its final rule, the courts will get their say—and they may pay more attention to Professor Tribe than to his wayward student.