If You Want $12 A Gallon Gas, Vote for Obama and Democrats

The June 22, 2008 program of ABC’s This Week had an interesting panel discussion consisting of George Stephanapoulos (the host of the program and former Clinton communications director); Democrat Rep. Ed Markey, the chairman of the House Select Committee on Energy Independence; Republican Sen. Kay Bailey Hutchison; Jeffery Sachs, director of Columbia University’s Earth Institute; and Red Cavaney, the President of the American Petroleum Institute. Their discussion was a good window into the positions of the Democratic and Republican political positions, as well as into the liberal environmentalist groups and the conservative-friendly oil industry.

GEORGE STEPHANOPOULOS: And let’s play off the summit this morning in Saudi Arabia. The Saudis have announced that they’re going to increase production by 200,000 barrels a day. Say they may even do more. But Congressman Markey, King Abdullah also took off after speculators. Is this increase in production going to be enough to bring prices down?

REP. ED MARKEY: It may have a marginal impact. There is, without question, in my mind, speculation going on. Manipulation going on. The Democrats are going to put bills on the House floor this week to deal with that issue. But in the end, this crisis is really caused by 12 years of Republican control of Congress. We’ve gone from 46% dependence when the Republicans took over the House and Senate in 1995 to 61% dependence upon imported oil today. We’ve had an oil and gas agenda. They’ve thwarted the renewal energy agenda. They are still blocking in the Senate the tax breaks for renewable wind and solar and geothermal and other renewal energy technology. We only have 2% of the oil reserves in the United States. OPEC has 67%. That’s our weakness. Our strength is that we are technological giants. We have not yet unleashed it. The Republican White House and House and Senate are still blocking that revolution.

SEN. KAY BAILEY HUTCHISON: Well of course, I would say that the Democrats have thwarted every effort we have made to increase our supply. This is a supply and demand issue. The demand has skyrocketed mostly because of global increases. And we have not done anything about supply because we’re thwarted in nuclear power, we’re thwarted in using our own national resources. Drilling offshore on a state-by-state option is something that I think we could do very environmentally safely. And yet anything that says production is killed by the Democrats. What I think we ought to do to get the speculators to stop thinking that the prices are going to go up is for Congress to show that we are going to take action with a balanced plan, with renewables, with nuclear power with expanded refineries, with drilling and exploration of our own natural resources. If we did that, yes, it would take five to ten years to get those things in line but the speculators would be out of the market.

RED CAVANEY: It is fundamentally, because unless you had very tight supply and demand, you wouldn’t create the platform that would allow people to think that there was an opportunity here to make an investment, and then that could lead to other kinds of things. So you must address the base global supply and demand situation in order to bring some sort of order. Like right now we’ve had civil disruptions of Nigeria. A million barrels are offline that are not available.

JEFFREY SACHS: We have to move fast on a number of fronts. We need conservation. We need long mileage automobiles which was delayed forever. We do need alternative energy sources, renewables. We need the nuclear. That’s got to be part of the mix. We are going to have to work together internationally. We ducked that issue entirely. Climate change is also part of the equation. This administration hid that from view for eight years. And so we never had a balanced plan. We never had a strategy at all. It was oil from first day. That’s been the big mistake.

Let me come in at this point and say that the basic parameters are all in place here: the Democrats do not view oil as part of the solution to the energy problem. They demand alternatives to oil. The Republicans do – and have for years – viewed domestic oil as a critical part of any solution to our short- and long-tern energy needs, and have tried largely without success due to implement a policy of increased domestic oil production.

Red Cavaney points out that the speculation that drives up prices only enters into the cost equation when the supplies aren’t meeting the demand. When supplies are abundant, you don’t have people betting that the prices will go up.

Rep. Markey attempts to attack Republicans for the increase in dependence on foreign oil; but do you see how absurd that is? It’s analogous to me beating the hell out of you with a baseball bat and then blaming you for being in poor health. Of course we’re more dependent on foreign oil than we were 12 years ago: a determined Democratic minority has been allowed to block any – and I mean ANY – significant effort to increase our domestic oil production. And – in absolute refutation of the Democrat’s mantra – we have NEEDED, now NEED, and will continue to NEED oil for the foreseeable future.

Markey goes on to say, “They’ve thwarted the renewal energy agenda. They are still blocking in the Senate the tax breaks for renewable wind and solar and geothermal and other renewal energy technology.” And that is partially true (although Democrats and their environmentalist allies have been responsible for overturning wind technology, and liberal environmentalists recently sued to stop the use of solar technology, so let’s not go too far blaming Republicans); but Democrats ought to look in the mirror when they demonize Republicans for blocking alternative energy by blocking tax breaks.

Democrats routinely shoot the country’s national interests, and then put the gun in the Republican’s hands.

Markey said we have only 2% of the world’s oil reserves. This is patently false, although one can measure “oil reserves” in so many different ways that virtually any figure is true depending upon one’s definitions. However, a significant percentage of the United States domestic oil reserves is contained in fields that will require new or improved technology for cost-efficient production. We are on the verge of being able to cleanly obtain oil from coal (the United States has the largest coal deposits in the world); we are on the verge of being able to obtain oil from shale (we have massive shale oil deposits in the Bakkan , and we are on the verge of being able to profitably employ deep-water drilling and slant drilling techniques. If and when the Demcrats allow the American people to obtain the oil it has, that “2%” figure would increase very dramatically. The fact of the matter is, if the Democrats allowed us to simply access the oil that is already readily available in ANWR and offshore, we could very quickly go from being the 12th largest producer of oil to the 4th largest producer of oil.

Another area that should be considered is the Democrat’s approach to “conservation.” Requiring automakers to produce more fuel-efficient cars is nothing more than an indirect way of forcing Americans to buy small, underpowered cars that they have historically not wanted. It is their way of attempting to force their will on the market – just as preventing domestic drilling is a way for the Democrats to force their will upon the market.

If they came out and imposed legislation requiring Americans to buy dinky little hybrid cars, Americans would be outraged. By trying to force automakers to produce the cars that they want Americans to drive, they are essentially doing the same thing, but most Americans haven’t quite figured that out yet.

I drive the speed limit, and I routinely see two things: 1) a lot of SUVs, trucks, and large-engined performance vehicles on the road; and 2) the aforementioned vehicles and virtually everyone else whizzing past me on the freeway going 10-20 mph beyond the 70 mph speed limit. The fact of the matter is that most Americans simply do not want to have draconian energy conservation policies imposed upon them – which is precisely the approach that Democrats favor.

In their constant attempts to manipulate the oil producers, and to manipulate the automakers, to do their bidding, Democrats show a fundamental distrust of the market and of the market forces that made this country great. And I would ask, based on what do they believe that big government bureaucracy can do a better job than the free market? Senate Democrats couldn’t even run their own cafeteria; just why on earth should we trust them to run anything?

Another interesting exchange:

REP. ED MARKEY: It’s kind of a sad day in American history. We were given one week’s notice to go over to Saudi Arabia today to beg the Saudi Arabians and OPEC to please produce more oil we can purchase. We have 700 million barrels of oil in our strategic oil reserve. The president should say to OPEC, that he is going to begin deploying 100,000 barrels of oil per day out of that strategic petroleum reserve to drive down the price. And he should also say to them like President Kennedy said to Khrushchev in 1961, that we are going to put a man on the moon. We are not going to allow the communists to control the skies. He should announce today a crash program that we are going to have automobiles that are dramatically more efficient. That we’re going to have wind and solar and geothermal. That we are going to use our technology in order to break our dependence upon Saudi Arabia and the rest of these countries. But that is not happening instead we’re over there with a tin cup begging them to sell more of our weakness to us, imported oil.

RED CAVANEY: Look, our concern is that what you need are permanent solutions. That’s the signal the market’s looking for. Opening up, providing some access, doing everything. We support all of the alternatives. Our companies are some of the largest players in that. Any scenario you look at, you will find that you need all the energy we can get of every kind and to take some off or to marginalize others is going to end up hurting the consumer. The consumer, when we went past $3 a gallon of gasoline, up to $4, they connected the dots. And that’s why you’re now seeing them asking for urgent action on the part of the Congress. They understand that we need more energy.

JEFFREY SACHS: It’s so interesting how there’s a, you know, a rough consensus on the things that need to go into this. But there’s been nothing that’s been done during this whole administration. Because they basically just turned away from realities, turned away from the alternatives, turned away from massive investments that are needed in the science and technology. They turned away from really investing in long mileage automobiles, millions of dollars rather than billions that are needed to get these going.

SEN KAY BAILEY HUTCHISON: Well first of all, we have made major investments in renewables and research. We have. We have increased huge amounts. However, let me just say look at the last month just as an example. We, the Republicans, have put forward a balanced plan. The Democrats came forward with a plan that had no energy production at all. It was sue OPEC. Congressman Markey has just said oh, we’ve gone over there with a tin cup. Well, at the same time, the Democrats are passing in the United States Senate a bill that would sue them. Now what kind of reaction are we going to expect from Saudi Arabia which is today, looking at trying to help the world market if we are going to sue them? That’s not a way to try to make friends and increase our supply. In addition the Democratic plan had two other things. A windfall profits tax which has been shown not to work and form a commission to investigate price gouging which is being done by the CPSC right now. So I do think we could come together. But not if the Democrats refuse to have any increase in supply. And the Republicans are willing to certainly do more in research, more in renewables, more in conservation, and I think you have a point. We haven’t done enough in conservation. But make those investments.

What is truly sad is that the United States has to go to Saudi Arabia and beg them to produce more oil when we could have been producing that oil ourselves. In a way, Markey – who is ostensibly blaming this situation on Bush and the Republicans – is actually lamenting that Democrats have been successful in implementing their agenda!!! If Republicans had had their way – and if they had not had their bills blocked by Democrats – we would not have had to go beg the Saudis, would we? Even by the liberals incredibly stingy figures on our oil reserves (the oil companies who actually know what they’re talking about claim we have much more), there is no question that we could have produced the amount of oil in question just by opening up ANWR.

One of the things that I always marvel at about Democrats is that they believe that only government money matters. They despise the free market system, and therefore consistently seek to impose big government bureaucracy in place of the free market system they fear, hate, and misunderstand.

The reality is this: why does the government have to invest in all these alternative energy sources? Why aren’t private investors doing it? I mean, by all accounts Barack Obama is going to raise $500 million dollars for his campaign; why can’t all these people put their money where their mouth is and invest in their vision of alternative energy? Answer: because their solutions don’t work, won’t work, and the market knows that.

I remember several years back when the State of California obtained $6 billion dollars for government-sponsered research in embryonic stem cells. How many cures has that $6 billion resulted in? ZERO. NADA. NEIN. BUTKUS. We needed that huge sum of money because private money wasn’t going into embryonic stem cell research. Apart from the fact that embryonic stem cell research has killed innocent human life, it hasn’t produced squat. So government money came in to fill the void, and the government funding hasn’t produced squat either. We might as well have dug a big hole, thrown in $6 billion, and then filled in the hole.

If a research program actually promises to produce a positive outcome that will result in an investment profit, private money will pour in. You can always spot a financial black hole by the cries for government funding. And the greater the cries for government funding, the bigger the black hole it is.

Contrast this with financing for oil exploration, drilling, and alternative source techniques. First of all, we are talking about a proven resource that WILL work, not some pie-in-the-sky useless liberal crap, and not some product that will require a massive overhaul of our entire energy infrastructure. But second, the reason these areas are underfunded is not because they won’t produce a positive return on investment, but due to the fact that they can’t produce any return at all because Democrats block any oil production! When the government won’t allow oil companies to produce oil, there is far less incentive for investment to fund the new technologies they will need. If Democrats would just get the hell out of the way, our market system would start working and producing the vital oil and energy that this country desperately needs.

Markey cites Kennedy vs. Khrushchev, when the United States beat the communists to the moon. The problem is, Markey and his fellow Democrats are today playing the role of Khrushchev and the communists, rather than actually helping the United States of America to accomplish its goal of energy independence. They are blocking the free market and imposing their bureaucracy in a matter very reminiscent of the communist state-managed economy (i.e. the folks who lost in the race to the moon, and then went bankrupt and collapsed altogether).

The real problem is, as Sen. Hutchison says, “The Democrats came forward with a plan that had no energy production at all.”

We need to make oil prices the albatross that we hang around the neck of Democrats. Barack Obama is in lock step with Senate Majority Leader Harry Reid, who says:

“Coal makes us sick, oil makes us sick, it’s ruining our country, it’s ruining our world.”

(See my article discussing that little pearl of wisdom).

Democrats routinely demonize oil. They routinely demonize oil companies who produce the vital resource we desperately need. They steadfastly refuse to allow the United States to increase either it’s domestic oil production or its refining capacity. It is directly due to their “commonsense plan” that we are in the situation we are in, and that we will continue to remain in the situation we are in.

If you want $12 a gallon gasoline, vote Democrat. They will offer “global warming” solutions up the whazoo that will undermine and eventually gut the American economy by starving our economy of the oil we need for our survival. If you want to lower the price of gasoline by means of effectively increasing our oil supply, vote Republican.

It’s as simple as that.

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7 Responses to “If You Want $12 A Gallon Gas, Vote for Obama and Democrats”

  1. Allen Taylor Says:

    Nice writing. You are on my RSS reader now so I can read more from you down the road.

    Allen Taylor

  2. tidewaterjackson Says:

    I don’t pretend to know all the ins and outs of this issue. That said, when gas is skyrocketing everyday after years of relative stability while oil companies turn record profits during a time of war, something’s not quite right. Don’t need to be an energy policy wonk to see that.

    You make some good points and you are clearly passionate on this issue, but I fear your post is simply a great example of where we are in America today. We’re locking into this all or nothing political thinking that your post is comprised of. My side is right and your side is all wrong is how we all seem to think.

    Face it, the GOP has had control of the White House for most of our lifetimes. The Republicans are surely equally to blame for this crisis. It’s the gridlock of American politics that has got us here. Both sides are to blame.

    And so is the America public (myself included). We refuse to sacrifice. It’s war time and we all still want to be riding in our big SUVs. Why can’t we smarten up and realize that we need to change?

    Maybe we should allow some more oil drilling. But then again what about all the land the oil companies own and for some reason aren’t drilling on? In any case, oil is going to run out at some point and we need to be ahead of the curve and start planning for that day now.

    Finally, if Democrats don’t trust the market at all, then I think your post shows that GOP-ers feel similarly about the government.

    Not everything that the government manages is bad or has worked out badly. Who won WWII? How about that social security. Despite the critics, it’s made a decent retirement possible for millions of people. And hasn’t water gotten cleaner since there were laws passed in the ’70s?

    Fact is that you can’t count on the free market for everything because the free market is made up of participants who care only about their own concerns – like drilling for more oil no matter what alternatives are out there.

    You need the free market and government to both be working on things like our energy policy. Even Dick Cheney would agree with that. After all, as I hear it it’s the oil companies who wrote this administration’s energy policies – and that sure has turned out well.

    Enjoyed your post,
    Tidewater Jackson
    http://www.fullcontactsports.wordpress.com

  3. ajnone Says:

    Though I take exception to a several points in your blog, you do make some valid and interesting points. I can’t let this one slide. You say:

    “Red Cavaney points out that the speculation that drives up prices only enters into the cost equation when the supplies aren’t meeting the demand. When supplies are abundant, you don’t have people betting that the prices will go up.”

    You accurately tap Red Cavaney to explain the conceptual relationship between supply and demand. That conceptual relationship is today being manipulated through fear-mantras originating from either the White House or its supporting lobbies.

    Oil supplies are keeping up with demand. Period.

    Visible speculators as well as managers of hedge funds and blind trusts today monitor not for indications of supply vulnerability but for queues in the press releases and sound bites from the White House, Iraq, Iran, Saudi Arabia, Israel, Lebanon and Syria … From these many sources they take their queue to buy or sell. If “the” agents of information are peddling fear, the speculators buy. If they are demonstrating calm and hope the speculators sell.

    Diamonds and oil are today both in abundant supply. Find anotherscape goat.

    http://www.ajnone.wordpress.com

  4. Michael Eden Says:

    First off, I’d like to thank you both for your comments. You both intelligently present your points.

    Let me briefly respond.

    Ajnone makes the point that “Oil supplies are keeping up with demand. Period.” Technically, you are correct, in the sense that we are not seeing long lines and rationing at the pump. But the plain fact of the matter is that we are in an environment in which increased supplies would lower prices, and the supply is not being increased. Democrats have threatened to literally sue OPEC and Saudi Arabia for restricting the supply of oil. And even Democrats acknowledge (and an admission to that effect appears in the article) that the Saudis can lower prices by increasing their production.

    And the million barrels missing due to the problems in Nigeria is another situation that has resulted in lowered supplies and higher prices.

    So, while so-called “speculators” would bet (that’s really what they’re doing) on lowered production and lowered supplies due to the events and headlines you cite, they are in fact betting on supplies either being reduced or distribution being reduced when they drive up the prices with their speculating.

    Another point that needs to be made is that speculators are actually a relatively small cause of the high oil prices. Again, I quote Democrat Ed Markey acknowledging that speculation “may have a marginal impact.”

    So I very much believe that I’ve got the right scape goat, and you the wrong one.

    Tidewaterjackson, you make some good points.

    But on the issue of oil and energy I think the Democrats are flat-out wrong, have been flat-out wrong for decades, and now we’re going to pay dearly for it.

    Democrats are clearly the party that has blocked every effort to increase our domestic oil production. And they – along with their environmentalist allies – have been to blame for the fact that we haven’t built a refinery for going on 30 years. Republicans have tried to pass legislation opening things up again and again, and Democrats – whether in the majority or in the minority – have blocked them.

    There are procedural maneuvers up the whazoo that a committed minority party can use to prevent legislation from being passed. Do some research and you’ll see how often Nancy Pelosi has blamed Republicans – clearly in the minority now – from blocking the Democratic legislative agenda.

    I have heard over and over again from Democrats that “we shouldn’t bother to drill because it wouldn’t have any effect for 10 years.” Barack Obama has said that on several occasions. But number one, that’s simply not true (we could have a number of high production sites increasing our supply in 1 year); and number two, just how long do they think it will take to get the alternative energy sources on line (and in our tanks)? Their position is plain gibberish.

    Do we need alternative energy sources? Of course we do. I haven’t heard a single Republican say we should abandon alternative energy – that is a straw man. But take a loot at alternative fuels such as ethanol – a fuel that requires more energy to produce than it releases, which is incredibly expensive (it is massively subsidized and is still prohibitively expensive), and which has shot up the price of corn. People in impoverished regions of the world are going hungry because of ethanol! And what else is out there that will make a difference faster than oil?

    The fact of the matter is that 85% of America’s energy will continue to need to be based on oil for decades to come – and Democrats have committed themselves to preventing America from obtaining the stable domestic supply it needs.

    By the way, you are completely correct: liberals don’t trust the free market; and conservatives don’t trust big government!

    Thank you both for your comments.

  5. Fitnrg Says:

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  6. tidewaterjackson Says:

    Thanks for your reply.

    My sense is that conservatives and the GOP have lost faith in America’s ability to innovate. Once we set goals like getting to the moon in a decade. Which, by the way, we achieved using a computer system that my current desktop would put to shame.

    Now, we hear responses like yours that we shouldn’t bother with biofuels that currently take more energy to produce than they provide according to you. Where’s the faith that we can innovate and improve biofuel technology. Why did GM do away with its electric car? It goes on and on. Unless god him/herself came down and presented conservatives a 100% perfect alternative to oil, there seems to be no openness to new ideas.

    Really do appreicate how courteaous your reply to my post was and will try to remember to follow that same example when I reply to comments on my blog.

    Finally, was curious to hear your thoughts on T. Boone Pickens’ recent comments/plan.

    All the best,
    Tidewater

  7. Michael Eden Says:

    Tidewaterjackson,

    Let me try to correct a couple misconceptions.

    First, I would NEVER try to argue that “we shouldn’t bother with biofuels.” That’s not my position at all. Rather, I have ridiculed one particular biofuel – corn-based ethanol – which is a horrible joke (if you truly care about biofuels, you should hate it too!). The sugar cane-based ethanol used in Brazil is great. Unfortunately, we’re mainly in the wrong latitude for that kind of crop, so sugar cane doesn’t work so well for us. Maybe we could use sorghum or molasses?

    So it’s not a matter of having “no openness to new ideas.” It’s rather a hostility to stupid ideas (like corn ethanol) that clearly don’t work.

    I WANT innovation. I think most conservatives yearn for the day when our cars run on water. But we’re just not there yet.

    Another misconception is that conservatives have lost faith in innovation (American or otherwise). What we have lost faith in is big government, not innovation. Congress can’t even run a cafeteria! We believe that it is – and always have been – private corporations and businesses that do the innovating. And, as we see it, liberals are routinely demonizing the very companies that are out there producing our energy.

    What we want is for big government to get out of the way and let the market do its job.

    We depend on oil for over 85% of our energy requirements. And by all accounts we will need to rely on oil for several more decades. Alternative fuels simply don’t produce enough energy for us to abandon oil.

    Since we need energy independence, and since we need oil, it makes sense that ANY reasonable energy solution would BEGIN with maximizing our domestic oil production. Conservatives are OUTRAGED that Democrats have done everything they could to cripple that production.

    Lastly, oil production STILL requires technology. To get the most out of American oil, we will need to employ new solutions. For example, we need innovation to develop shale oil – but when we do, we will have MASSIVE reserves. We also need clean coal technologies.

    But what do Democrats want to do? They want to massively punish these industries to fund OTHER alternative energy sources which can’t begin to solve our energy needs.

    Conservatives want investment in energy that meets our needs.

    From what I’ve heard about T. Boone Pickens, he is looking at two principle sources: natural gas and wind. I have no doubt a guy like him can make both work profitably. I wish the man every success. We need the energy!!!

    What I DON’T want to see is inefficient sources of energy that are massively subsidized by the government (whether to combat the sham of global warming or whether to make some politically-connected rich guy richer).

    I appreciate your considering me courteous to you. I have to admit to having more than once been nasty to those who’ve been nasty, but I always try to be courteous to those who are polite and present intelligent positions (and even to those who present silly positions in an intelligent manner!).

    Thanks for reading and for posting.
    Mike

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