Over at the Washington Post, Jennifer Rubin, just back from vacation is blogging up a storm and her posts are, as always, well worth your time. She mocks “the media horde” who, “like a moth to the flame”, have been congregating “around the egomaniacal Donald Trump.” She asks if the president is going to “allow Gaddafi’s mercenaries to act with impunity“. She critiques his “half-hearted Middle East policy.”
And, she notes, as the cost of a gas climbs toward $5 a gallon, at least here in California, this new kind of politician has turned to a page from the old Democratic playbook and decided to blame the oil companies for rising prices, devoting “his Saturday radio address to the issue of rising gas taxes”.
The problem, however, is not big, bad greedy oil companies, but the big, strong regulatory apparatus of the federal government, preventing companies from drilling for oil on our own shores and for developing, free of the hand of state intervention, new sources of energy. Indeed, the Obama Administration, Rubin reminds us, has “helped restrict domestic supply.” When we could pump more oil, we increase domestic supply. A greater supply means lower prices.
Thus, “If Obama,” she concludes, “wants to do something productive, he’d open up new domestic sources of oil and natural gas instead of new inquisitions of energy executives.” Exactly.
With his push for “‘clean-energy’ government subsidies”, the president pulls another page from his party’s playbook, calling for the federal government to “fix” a problem the federal government created — and not by eliminating the source of the problem, but instead by compounding. More government intervention as the answer to the failure of government intervention.
Without strict federal regulation over our natural resources, we could pump a lot more oil in the United States, thus sending fewer dollars overseas and keeping gas prices lower across the country.
UDPATE: Doug Ross provides one example of how the administration is keeping gas prices high: “the EPA,” he reports, has “blocked Shell Oil’s second effort to drill an exploratory well in Alaska’s Chukchi Sea.”
That’s all bullshit. When gas prices skyrocketed in 2008, it was purely because of speculation in oil futures and had absolutely nothing to do with supply or demand. In that regard, you’re somewhat correct in stating that it isn’t directly the oil company’s faults, it’s financial companies (surprise, surprise.)
Further, it would take years for domestic wells to start producing and even then, the amount would be negligible compared to what OPEC puts out. Clearly, the problem is that so much of the global economy is based on a finite resource whose prices fluctuates wildly. The solution is to transform the economy so that we aren’t as dependent on a single commodity.
“The problem, however, is not big, bad greedy oil companies….”
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How much is the dollar worth today as compared to a year ago?
If the dollar is only worth 50% of it value last year, then twice as much money is needed to represent the same value this year. Causing massive inflation, and blaming ‘profiteers’, is pure deception.
Does Obama’s “record oil company profits” take this into account? I’ll bet it does.
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Your pure logic made Evil’s head explode. Well played, sir.
“it was purely because of speculation in oil futures and had absolutely nothing to do with supply or demand. ”
At the very heart of speculation is the supply and demand at a given time in the future. You make money by speculating that the demand will out pace the supply. How can you possibly remove supply and demand from the process of speculation. If not the relationship of supply and demand, just what are they speculating on?
V the K, does Levi even get the Evil reference? Hint Levi: Fright Night.
Psssst!!!! Levi. Wanna make a million easy and no sweat? Buy low and sell high.
Psssst!!!! Levi. Wanna make another million easy and no sweat? Power airplanes on grass clippings.
Pssssst!!! Levi. Wanna make another million easy and no sweat? Perpetual motion machines …… pass it on.
Right on, TnnsNe1.
Speculation on the long side reserves current supply for future use. The speculator says “Hey – the way it’s going, this thing will have to be more scarce and valuable in the future. I’m going to pay today’s prices to reserve it.” If she’s wrong about that, she loses – and no harm done to anyone else. (Her loss helped other market players get a bit richer and create jobs.) And if she’s right, she performs several SOCIALLY VALUABLE functions, not limited to the following:
1) By tending to raise the price, she gets people to use less (leaving a bit more for the future).
2) By tending to raise the price, she sends a message that the thing is in danger of becoming too scarce and valuable in the future.
3) By tending to raise the price, she stimulates production of the thing – both now, and even more in the future. So that the future danger of extreme scarcity is slightly lessened.
All that is way over Levi’s head… because it involves, you know, planning for the future. But I digress. My point is following. Speculators look at Obama’s anti-oil, anti-energy, anti-business, anti-human life policies, and conclude rightly that oil is in danger of becoming overly scarce and valuable in the future. So they buy it now. It has EVERYTHING to do with supply and demand… again, as it brings present supply into the future and future demand into the present.
It also has everything to do with Obama’s destructive policies. The lesson is that we should change Obama’s destructive policies. It doesn’t matter if it takes 20 days or 20 years to bring actual new production online: the mere fact of an improved policy – the mere threat of increased future production – will make the speculators (ILC coughs here) wrong, bringing down prices now.
Thus, in fact, the current oil/gasoline price increases have everything to do with supply and demand… if you can think about the future, i.e. think beyond the range of the next 10 minutes. And, they have everything to do with Obama’s bad policies.
The sick joke is that, in other contexts, lefties are quite happy with higher prices for oil/gasoline and talk amongst themselves about how nothing will change for the better, Gaia-wise, until we can get people out of their cars due to high energy prices. In other words: Levi’s outrage is feigned.
And another bad Obama policy that is causing high oil/gas prices is his (and Bernanke’s) destruction of the dollar. As oil is traded in dollars, a devalued dollar implies higher oil prices by simple math. But y’all have seen my views on that bad policy choice of Obama’s, many times. I’ll stop.
LOL @Heliotrope – Yes, Levi’s comment there was like saying, “You know what would really help the economy? If we cured cancer.” No real solution at all, only an ignoramus’ idle wish that others provide a solution… by what magic, he does not care to say (and would be incapable of grasping).
What idiots like Levi don’t want to acknowledge is the reason speculation is able to drive the price of oil up is because they are betting on the Ignorant Policies of morons like 0bama causing oil to remain artificially low in supply and continue for a long time at the high price due to refusals to actually drill for oil in our own country. But He did lie when he told Levi and the rest of us he would reduce our dependency on foreign oil…so he gives a bunchaton of $$$ to Brazil so they can go drill for oil and tells them he eagerly awaits buying it. That is not reducing our reliance on foreign oil. That is a bald faced lie.
But his “Under my plan, Energy prices will necessarily skyrocket” promise is being well kept.
So true. It’s roughly equivalent to saying, “Oil is bad, and we should use clean, abundant unicorn farts to power the economy.” Because although there are some potential alternatives that might be practical in twenty years or more, the existence of an adequate substitute for oil now is as real as unicorn farts.
Also, Evil’s amazing ability to thoughtlessly parrot every hack left-wing talking point remains a consistent source of amusement.
Not to mention…
President Clinton looked at speculators… and found nothing.
President Bush looked at speculators… and found nothing.
So President Obama is supposed to suddenly find something… why? Because he’s clean and articulate?
Also, since Barack Obama is a wholly-owned and operated subsidiary of George Soros, whose billions come primarily from speculation, what we’re again seeing is that it’s not speculation Barack Obama and Levi oppose; it’s their lack of a cut.
That’s all bullshit, you ignorant wretch. As we recall, back in 2008, the liberals blamed Bush, then the speculators, then OPEC (remember when they proposed to sue OPEC?), then the oil companies, then Bush again, then the oil companies again, then the speculators again, then OPEC again etc.etc.etc.
That space cadet the Florida liberals keep electing Senator kept repeating that steaming pile of shit.
Do NOT doubt me.
And who could forget 2004 when the libs were demanding that Bush speak to the Saudis and then went apeshit when he finally did?
You and yours are absolutely and dispicably full of shit, Levi. You can pack that fudge where it belongs.
#Smh seriously are we back to this game? who lives in the real world now Dan, Levi is completely correct in this one and your completely looking cat lady crazy. No amount of oil production in the US is going to reduce prices while our consumption stays the same. IT might change who we give money to but little will change beyond that. Once the price goes up and people continue to pay those profiting will continue to find ways to make it reach those heights again. This rise in prices is fed by financial corporations and sovereignly held oil companies. Blame your precious corporations for once, they are the ones making bank.
Well Tim, now we know you’re as dumb as Levi. Good job.
… which Obama is beholden to. (Goldman-Sachs) Which Obama bailed out. Which Obama and Bernanke have pumped trillions into, through their interventions in the financial markets known as ZIRP, QE1 and QE2.
So what are you going to do – go to war on those countries? We might have to invade Venezuela and depose the left-wing darling Hugo Chavez, you know.
How little you understand. Not speaking for Dan, but personally, I blame corporations all the time – the ones who betray capitalism by getting in bed with Obama, or with government generally. (Some call it crony capitalism, some call it corporate socialism or corporatism, I call it fascism.)
(continued) But the cause of the problem there is, of course, government throwing its weight around far too much, trying to pick winners and losers instead of letting the market do it (which is the People).
That point (of Dan’s) can’t be said often enough. Leftists offer poison as food, poison as antidote.
Another would be the Obama administration’s war on oil production in the Gulf: http://www.reuters.com/article/2011/04/21/gulf-production-postspill-idUSN2129296320110421
To bottom-line it:
– If you fight a war on oil production, while simultaneously flooding the world (and especially your well-heeled friends) with trillions in new money that has to land somewhere, you are going to cause the price of oil and gasoline to go up. Way, way up.
– If you don’t like that, you could reverse it by ceasing your war against oil production, and ceasing your reckless spending and creating of money.
But then you have to be aware of nasty stuff like cause and effect, supply and demand, the future, and so forth. It’s vastly more fun to ignore those things, spend recklessly and then try to scapegoat evil “speculators”.
And one more thing, ILC; when the price of a commodity is denominated globally in a specific currency, and the value of that currency is artificially reduced, the price of the commodity goes up.
Oil is denominated in US dollars. Obama and his puppet Bernanke have systematically devalued the dollar to create those trillions of dollars for Obama to hand out to his cronies and owners like George Soros — who is also, inexplicably, investing in oil futures and oil companies and shorting the dollar, meaning that he makes money as the price of oil rises and the dollar goes down in value.
But of course, Levi and Timmeh would NEVER criticize Soros, even though he’s speculating in both oil AND currencies. Neither would Barack Obama, even though he’s screaming about how evil speculators are and how they need to be punished.
Exactly: some of Obama’s biggest supporters are the very biggest speculators. Obama’s complaints are just for show.
Follow the money, as they say.
Today’s gallon of irony: Obama support among hedge fund managers has begun to drop.
“Hedge fund manager” means: speculator. Some key take-aways:
– Obama was the darling of speculators to begin with, as we’ve been saying. (And remains the darling of some.)
– Even hedge fund managers can get Stockholm Syndrome.
– Stockholm Syndrome never works. It never appeases the terrorist/tyrant.
– Even hedge fund managers can wake up from their Stockholm Syndrome, if they try.
This quote is a beaut:
Memo to Wall Street Democrats: The same thing happened to another batch of you guys, who thought you were cleverly backing another National Socialist in another era.
But, the learning process is still slow for some:
(continued) I guess a question remains, to what extent is Obama in these guys’ pockets?
– There is evidence that Obama has gone farther than they wanted, on certain things like the tax arrangements, thus “hurting their feelings”.
– On the other hand, some of them sound pretty confident that Obama’s moves are just for show / Obama is in their pocket. And I argue that Obama’s bailout/QE/ZIRP policies are designed to enrich them.
“The corporations are all corporationy, sitting in their corporation buildings…
Perhaps the oil companies should, as some progressives have suggested, be nationalized for the common good; that has worked out so well for Venezuela.
@V the K, I’ve been pondering the future of oil and it does seem likely that at some point governments will try to stop the rising prices in some way, specially if some sort of larger conflict broke out in the middle east and the Sauds stopped pumping oil. I think I’m going to reread some WW2 history and see what happened last time.
Would the libs be stupid enough to eliminate speculators guaranteeing Carter-tonian-enian(?) gas lines and European prices?
Yes TGC, they would. (BTW I still miss the old handle!)
Hey all–here’s a GENIUS idea for the next time you have to fill up.
http://bit.ly/eYkM7C
Enjoy!
By the way Timmeh, a bit more on this:
That doesn’t sound very unifying. What happened to your self-proclaimed mission to preach the message that we Americans have far more uniting us?
@ILoveCapitalism it’s very possible that they might, I’m wondering what will happen when security interests bisect national interests while the country queues up for gas rationing. If the strategic oil reserves really only number 600 millions barrels and we use 20 million barrels a day than that leaves us a month or so to decide what to do I guess. I still think we should us less oil.
Just as a weird coincidence, the name Levi was also the name of a famous tax collector in the Bible. It was in the New Testament that the name appeared.
When Levi stopped his evil ways (tax collecting), he changed his name to Mathew and became an Apostle of Jesus Christ.
Sorry to go off-topic like that. Please carry on. 🙂
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I do blame governments for part of the oil price hikes. What we have is a dependence on a shrinking/depleting resource. And at the same time, increasing demand for this product (primarily China and India). Even if we grant arguments about commodity inflation (and a devalued US dollar), the real driver behind the increased price for oil is the nexus between supply and demand of the product. We need to be less dependent on it, and in time, higher prices will increase substitution away from oil. So, I am one of those who think that higher prices for oil is a good thing (insofar as they reflect real pricing). But in these economically strapped times, the main problem is that we have little resources to really aim at alternatives to oil in providing power, which would help lower long-run demand for oil. One source, is to take the subsidies that oil companies get from the US taxpayer, and put those to alternative uses. Alternative uses include:
a. doing basic research to develop alternative fuel sources (lowering demand for oil).
b. rebuild the internal transport infrastructure (i.e., railways, waterways, new grids for alternative power transmission etc) (also lowering demand for oil).
Emphasis on not trying to pick winners and losers in energy, but allowing energy prices to actually reflect the real costs associated with the resource.
http://www.earthtrack.net/blog/some-additional-thoughts-subsidy-reform-and-obama-budget
It won’t be the total answer, but it will be a step in the right direction:
http://www.nytimes.com/2010/07/04/business/04bptax.html
http://www.americanprogress.org/issues/2010/05/oil_company_subsidies.html
“Tallying state, federal and other incentives exclusive to the oil industry, DTN’s total comes to $17.9 billion annually…. Considering all tax breaks and other incentives, including those open to all industries, oil receives between $133.2 billion and $280.8 billion annually. The majority of oil’s incentives come at the federal level. There also are a handful of state-level subsidies in some of the largest oil-producing states.”
http://www.energetixllc.com/files_uploaded/e7e1c329322b3712b2c8e3aa0b7e78be.pdf
It is an interesting article–good material also for those who support oil company subsidies as well.
I grant that over time, removing these subsidies will lessen exploration and thus the long-run supply of oil. Yet, since the oil that we have left in the places that people are now exploring is going to be very expensive to remove and use (and have large potential downsides like the Transocean catastrophe of last year demonstrated), this approach accepts the reality of less and more costly oil, and starts to prepare for it. It also accepts that we will probably have to restructure the way we organize our society to be less individually car dependent (transport, urban living, suburban rationalization, etc) and/or more plugged into a communally available electric grid or both…
Always. On the supply side, the Obama administration is in a war against U.S. oil production (see above reference for 20% decline in Gulf production since Obama took office). And on the demand side, demand from India and China is one of the mechanisms by which U.S. dollar devaluation shows up in the oil markets, as increased nominal demand. (Fed prints trillions; the waterfall of new dollars would earn 0% in the U.S.; the dollars flow abroad whether as investment or as trade deficit; foreign governments and citizens and companies have more dollars to spend; they buy accoutrements of a higher living standard including oil, thus outbidding us.)
Global speculators correctly spot those trends, then spend money to reserve present oil supply for the future (or to say it another way, they bring future oil demand into the present). The Fed’s war on the dollar (ZIRP) helps there again, as it greatly lowers the opportunity cost of speculation. If the outcome (higher oil/gasoline prices) is considered bad, then change policy: on the supply side we need to stop Obama’s war on oil production, and on the nominal demand side we need to stop the Fed’s war on the dollar.
I have a good answer: Let free markets operate over time. Obama has (and apparently you have) a poor answer: Corporate welfare for Obama cronies, euphemized as so-called “investment” in “green technology”.
Tax breaks aren’t subsidies. If you think the tax code should be made more rational and applied more evenly (and I would agree), that is a valid, but different discussion.
Your reference employs the Orwellian language coming into vogue on the Left, whereby the government’s raping a company (or a person) a tad less hard in certain ways is to be euphemized as generous government “tax expenditure”. I don’t employ that twisted, dishonest language.
Wow. You seriously expect that government “investment” in politically chosen companies and/or technologies can accomplish something. I don’t.
And that is the Left’s real agenda. Thank you for admitting it.
(continued) But it won’t stop India or China from snatching up the oil and using it. And it won’t stop Russia or the Arabs from producing it. So, no net gain to it, “green”-wise; only American pain.
May I suggest that if the energy barons thought that their current supplies were in serious doubt, they would be working overtime to find a viable substitute.
Leftists think that oil companies are so wedded to oil that they will do the near impossible just to drill and extract more oil. Hello? If oil companies could fly airplanes, power ships and move goods on wind power or solar power or tidal power or hydro power or geothermal power or fusion, they would have been on top of it decades ago.
The military knows very well the problems associated with out-running their supply lines. Wouldn’t they be in clover is tanks could roll fueled on recycled plastic bags?
The point is that all this “alternative” energy has produced a dangerous, mercury poisoned curly light bulb. Why hasn’t MIT found a way to light a home by a cat rubbing against a door jamb? It is not for a lack of trying.
But, typically, liberals see everything as solvable with enough government money.
Levi, et al. are convinced that if you rub two liberals together it will result in a miracle. We understand that if you rub two liberals together, it will result in a puddle of sludge.
The production of energy comes in many forms. It is the storage of energy that is vastly lacking. Oil products store energy in an extremely efficient manner.
The country is whipped with tornadoes and Spring floods. Got a way to store all that energy? Levi, Cas, Ugga-Bugga, anybody?
I have a good answer: Let free markets operate over time. Obama has (and apparently you have) a poor answer: Corporate welfare for Obama cronies, euphemized as so-called “investment” in “green technology”.
Let us show an example of what Cas supports and endorses.
Fremont solar maker Solyndra has a short but stormy history.
Less than a year ago, President Barack Obama held it up as a poster child for clean energy, saying during a visit to its headquarters that “companies like Solyndra are leading the way toward a brighter and more prosperous future.” But now, despite having raised more than $1 billion in venture capital and receiving a $535 million loan guarantee from the Department of Energy, Solyndra is struggling and analysts can’t see a way forward.
So let’s see, over half a BILLION dollars down the tubes on one company, and for what?
The company says it shipped 60 megawatts worth of panels last year and expects to double that quantity this year. One megawatt of power is enough to power about 200 California homes.
So let’s see, 120 megawatts worth of capacity, enough to power 24,000 homes at a cost of $535 billion.
Or, phrased differently, over 22 MILLION dollars paid per household for electricity.
Believe us, Cas, we’re impressed. Incredibly so. Never in history has an administration and an ideology been so effective at kicking back money to its campaign contributors and getting so little for taxpayer dollars in return.
You and yours rant about an alleged $18bn in “subsidies” to the companies which, between them, keep over 250 MILLION cars in motion, not to mention nearly that many trucks and airplanes, hundreds if not thousands of factories that use petroleum as raw material, and all the millions of homes, businesses, and offices that are made habitable and operational by oil, natural gas, and other petroleum products.
While you’re simultaneously pissing half a billion away on a company that can’t even light up a decent-sized town and calling it the wave of the future.
Peak oil is here.
There is no denying it.
It’s not that they believe that, but the eeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeevil oil corporations have actually been spending more money than the feds on alternative fuels for years.
TGC,
True that. But the Progressives believe that all the genius around the globe that want to break the dependence on fossil fuels are held captive by the oil companies. The minute some guy in Nepal starts dreaming about alternative energy, the oil companies pick up his brain waves from his I-phone and they nab him! Just like that! Dead of night! Anywhere in the world!
So, when you suffer from such logic, it only makes sense to throw billions at a chicken farmer in Idaho who has a plan for harnessing the energy of glow worms to power high speed trains and UPS trucks.
It is also amusing to realize that MIT and such villages of vision and intellect have not broken the energy storage conundrum or gotten past how turbines generate electricity.
Simpleton Progressives keep on keeping on with their utter faith that by sending tax dollars out to charlatans and hucksters eventually, someone will discover a way to harness the tides and ship the power in a pure form to Kansas for use in a tractor.
As if, there is a dearth of ideas and intellectual energy which is being stalled by waiting to be financed.
Heliotrope, right on. Sometimes it seems all of liberalism is just the intersection of wishful thinking and conspiracy theories.