GMM Policy Forum

Addressing America’s fiscal challenges will require both raising revenue and cutting government spending, said Mary John Miller, the U.S. Treasury Department’s Under Secretary for Domestic Finance, at the Policy Forum of ICI’s 55th annual General Membership Meeting (GMM).

“I don’t think that we can balance the budget over the long term and meet the obligations that we have without some revenue,” said Miller, who made her remarks as part of a wide-ranging colloquy with ICI President and CEO Paul Schott Stevens. “When people come to talk to me about the Administration’s proposals, I say, ‘Look, everything has to be on the table’,” she added.

Full story at ICI Viewpoints.

Solar Entrepreneur To Feds: Step It Up

At the upcoming U.S. political conventions, it’s a safe bet you’ll hear more than a little bluster from Democratic and Republican parties about the need for federal “investment”–don’t call it a subsidy–in renewable energy technologies such as solar, wind and so on.

A lot of hot air? It won’t be for Frank van Mierlo, co-founder and president of Lexington, Mass.-based 1366 Technologies. The young company has raised $12.4 million in venture money in support of its mission to make solar power cost-competitive with coal by 2012.

Key to that mission: a more vigorous role for the U.S. government. “There is no way that we can change the energy resources in our society without real leadership from the government,” says van Mierlo. “The current administration, it’s sad to say, has not provided that leadership.”

Full story at Forbes .com

Natural Gas: Booming In The Beltway

Washington, D.C. – The natural gas industry has been turning up the heat this summer in the nation’s capital. Advocates are explaining to lawmakers that while oil is expensive, scarce and imported, there’s enough natural gas in the U.S. supply to last more than 100 years.

One example: Aubrey McClendon, Forbes 400 member and chief executive of Chesapeake Energy (nyse: CHK – news – people ), the second-largest independent producer of natural gas in the country. Speaking at a Congress hearing Wednesday, he sounded more like someone in the business of political snake oil.

“Imagine if tomorrow you could announce a new energy plan that would in one stroke cut your constituent’s gasoline bill in half, reduce our oil imports, improve our air quality, enhance national security, strengthen the dollar, reduce greenhouse gas emissions and create tens of thousands of new jobs in the U.S,” McClendon said. “I believe your upcoming reelection chances would be even higher than they already are.”

Smooth. McClendon and other panelists at the hearing, convened by the House Select Committee on Energy Independence and Global Warming, want Congress to know that natural gas can have a more prominent role in America’s energy future.

Several lawmakers seemed convinced, describing natural gas as “a precious resource,” a bridge to a renewable energy future–and a replacement for coal.

Full story at Forbes.com

Political Risk Watch: Nanotechnology

In print and online, Forbes has chronicled the amazing potential of nanotechnology, or the ability to see, manipulate and manufacture things that are as small as one-billionth of a meter.

At a Wednesday event in Washington, D.C., a panel of experts didn’t play down that potential.

“The future of nanotechnology is extraordinary,” said J. Clarence Davies, a former Environmental Protection Agency (EPA) official who now serves as a senior adviser to the Project on Emerging Nanotechnologies at the Woodrow Wilson Center in Washington. “When you start crossing it with synthetic biology and artificial intelligence and so on, science fiction looks very pale in comparison.”

Lately, however, the market has not shared in the enthusiasm, at least when it comes to pure-play nanotechnology stocks. In the table below, we show four that have dropped more than 45% from their respective 52-week highs.

Uncertainty stalks these companies. Altair Nanotechnologies (nasdaq: ALTI – news – people ), Nanophase Technologies (nasdaq: NANX – news – people ) and Nanosphere (nasdaq: NSPH – news – people ) have never turned a profit, and security analysts project that all will lose money for their current and upcoming fiscal years.

Another source of uncertainty, although not necessarily a negative, is regulation. Thicker red tape surrounding nanotech is practically inevitable, say Davies and colleagues, who have released a 28-page regulatory agenda for the next administration.

Full story at Forbes.com

Rough Road Ahead For Highway Bill

Washington, D.C. – As we’ve regularly reported on Forbes.com, the road building lobby in Washington makes a loud and skillful case that federal spending on highways–$41 billion for fiscal 2008–is inadequate and that the nation’s infrastructure is facing a crisis.

This week, several hundred industry folks descended on Capitol Hill for their latest lobbying offensive.

“It’s a severe situation,” said David Bauer, senior vice president for government affairs at the American Road & Transportation Builders Association, Tuesday. “It’s probably as severe as [any during] the 11 years that I’ve been at ARTBA.”

Why so severe? One reason is the legislative outlook, as discussed by a panel of Democratic and Republican congressional staffers that ARTBA had summoned for a briefing Tuesday. The consensus among them: reauthorization of the nation’s multi-year transportation spending law, enacted in 2005 with a $287 billion price tag, could prove much trickier than the last go round. A new administration and new environmental issues will complicate already contentious issues of funding America’s infrastructure.

Full story at Forbes.com

Political Headwinds For Hotels

Washington, D.C. – Turnout was good this week for a legislative conference organized by the American Hotel & Lodging Association, a trade group. But as they took in cherry blossoms and sunny weather in Washington, hotel execs weren’t treated to a favorable political outlook.

“Under the usual rules of political gravity, we Republicans are cooked,” said Michael Murphy, founding principal of government relations outfit DC Navigators, on Monday. “In the House and Senate, it’s going to be bad for Republicans.”

Tuesday, Republican Congressman Ric Keller, whose district includes Orlando, Fla. told the hotel crowd that the upcoming election will be determined by independent voters. “I don’t know how independents are going to feel about Iraq six months from now,” he added, “but right now they’re not too crazy about it.”

Not all hoteliers are conservative, of course, but the American Hotel & Lodging Association (AHLA) tends to lean that way. And any erosion of the Republican minority could prove a setback for hotel operators, namely on labor issues.

Full story at Forbes.com

Hospitals Seek Congressional Care

Washington, D.C. – In a shaky market, hospital stocks have lagged as a group. The seven in the table below trade an average of 28% off their 52-week highs, versus an equivalent decline of 14% for the S&P 500 index.

Yet, while it sputters in the marketplace, the hospital business remains well-oiled inside the beltway.

“Everyone knows the hospitals have been struggling for years with bad debt, with the uninsured, with reimbursement issues, with being squeezed by managed-care companies and so on,” says Michael Wiederhorn, executive director and equity analyst at Oppenheimer. “Republican, Democrat–no one wants to see the hospitals struggle or wants to take money away [from them].”

The mood this week has been suitably upbeat at the annual membership meeting in Washington of the American Hospital Association (AHA), an advocacy group. A brass band greeted hundreds of hospital execs as they filed into a hotel ballroom for a legislative briefing Monday. Like a ballgame, the morning session opened with the national anthem and cheers.

“The turnout for this annual meeting, our 39th, is terrific,” said American Hospital Association Chief Richard Umbdenstock. Good thing for him: Wednesday, he’s sending attendees (1,700 registered) to Capitol Hill to hit up legislators on AHA’s top priorities.

Full story at Forbes.com

Voting With Their Wallets

Washington, D.C. – So far in the 2008 election cycle, Barack Obama has pulled in the most dollars from folks working for the 118 companies that make up the Forbes Beltway Index.

Using data from the Center for Responsive Politics, a nonpartisan research group in Washington, D.C., we tallied individual contributions made this year and last, through March 3, for Hillary Clinton, John McCain and Obama.

The Center for Responsive Politics’ database, searchable here, tracks individual contributions of $200 or greater, as smaller contributions are not part of the public record. Note also that we did not survey contributions made to political action committees.

By the individual contributions measure, Obama’s take adds up to $962,000 from people working at Forbes Beltway Index companies. Clinton and McCain, respectively, show contributions of $771,000 and $525,000.

Full story at Forbes.com

Biodiesel In The Beltway

Washington, D.C. – In its mission statement, the National Biodiesel Board has a simple goal. By 2015, the Jefferson City, Mo.-based trade group would like to see 5% of the U.S.’ diesel needs met by biodiesel, a fuel made for diesel engines from feedstocks such as animal fats, greases and vegetable oils.

The U.S. goes through 60 billion gallons of diesel annually. In 2007, 500 million gallons of biodiesel were produced. So for the National Biodiesel Board (NBB) to complete its 2015 mission, biodiesel production will have to increase at a 29% annualized clip over the next seven years.

Six years ago, biodiesel production stood at just 15 million gallons, implying a headturning 111% yearly growth rate since. But maintaining the momentum will be tough. The industry faces loud skepticism from environmentalists, who fret about biodiesel and byproducts getting dumped into streams, and economists who question whether biofuels can ever be viable without heavy government support.

So a favorable terrain in Washington will be key, as the biodiesel industry’s biggest players make clear. In its annual report, for example, biodiesel refiner Nova Biosource Fuels warns investors that the “U.S. biodiesel industry is highly dependent on a myriad of federal and state legislation and regulation.”

Full story at Forbes.com

Taking On Congress’ Favorite Biofuel

For a young company, Virent Energy Systems seems to lead a charmed life. The Madison, Wis., biofuels outfit has pulled in more than $30 million from venture capitalists while striking strategic relationships with the likes of Cargill, Honda Motor and Royal Dutch Shell.

Watch Virent Chief Executive Eric Apfelbach’s crisp PowerPoint presentation on the company’s business, and you’d probably want to get a piece of this action too. Virent has a low-temperature, low-pressure, catalytic process for turning carbohydrates (sugars) into gasoline, diesel and other fuels. Its 70 employees now make a gallon or so daily. Targeting gasoline as its first fuel, Virent hopes within five years to raise that production to 10 million to 15 million gallons annually.

The jump from several hundred gallons to 15 million will require extraordinary chemical engineering, a feat Apfelbach sounds confident his company can pull off. Engineering a hospitable climate in Washington, D.C., however, could be trickier.

“We have to make sure that we don’t get locked out,” worries Apfelbach, 47. “We just don’t want to get killed by policy.

Full story at Forbes.com