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Even Yahoo! is onto Obama’s Oil Demagoguery

Saw this last night on Yahoo! — where the news tends to skew left:

Smoke and mirrors?

Perhaps:

President Obama today raised the ante on his efforts to limit the rise in oil prices. The president, joined by Treasury Secretary Tim Geithner and Attorney General Eric Holder, called on Congress to adopt tougher rules on speculators in the oil market.

. . . .

The Daily Ticker’s Henry Blodget says the proposal is “embarrassing” because speculators have little to do with the rising price of oil and gasoline. Prices are moving higher, Henry says, because “three billion new capitalists” in India and China are consuming oil and gasoline. It’s the balance between supply and demand that determines whether oil prices rise or fall, not speculators, Henry argues.

And then, of course, there are the Obama administration’s own policies which, by limiting exploration, have made it difficult to increase supply to match increasing demand.  If the president were serious about reducing oil prices, he would eliminate federal regulations preventing exploration and expedite the approval process for drilling on federal lands.

Seems that for this president, the solution to every problem is tougher federal oversight when, in many case, it’s federal meddling which created (or exacerbated) the problem in the first place.

And this time for a change, some in the media are catching on.

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9 Comments

  1. There is so much wrong with Obama’s rhetoric on this “oil speculation”; Where does one begin?

    Another squandered presidency…

    Comment by Geena — April 18, 2012 @ 6:01 am - April 18, 2012

  2. If only you materialistic Americans abandoned your evil cars and driving freedoms. (;

    Comment by Ben — April 18, 2012 @ 7:58 am - April 18, 2012

  3. Nice photo of the three stooges.

    Comment by Richard Bell — April 18, 2012 @ 8:00 am - April 18, 2012

  4. It used to be that I could fill the gas-tank of a large car for $20.
    Now it costs me that much to fill the gas-tank of my lawn mower….

    And what message does Obama send to the Canadian oil producers? Don’t build your pipeline to our refineries in Texas and Louisiana, build it to Vancouver and sell your oil to the Chinese….

    How’s that Hope and Change working for ya?

    Comment by Ted B. (Charging Rhino) — April 18, 2012 @ 9:15 am - April 18, 2012

  5. Obama has said this every year he’s been in office as the gas prices rise along with inflation thanks to the weakened Dollar. His demagoguery is taking him nowhere. He’s desperate.

    Comment by Sebastian Shaw — April 18, 2012 @ 9:34 am - April 18, 2012

  6. There is so much wrong with Obama’s rhetoric on this “oil speculation”; Where does one begin?

    Geena, I thought that very thing. I’ll give it a shot though.

    From Wapo’s version:

    “We can’t afford a situation where some speculators can reap millions while millions of American families get the short end of the stick,” Obama said at the White House.

    First, what speculators (IF ANY – see below) would be speculating on, is Obama’s bad policies against future oil production, as well as his and Bernanke’s policies that weaken the dollar (depreciate its value). As Dan suggested, Obama’s bad policies is the situation that we can’t afford.

    But the deeper meaning here is Obama saying: We can’t afford freedom. We can’t afford markets. We can’t afford the price mechanism. We must have a centrally planned economy.

    What he calls “speculation” is part of how markets, or the price mechanism, solves problems. So-called “speculators” are people who look into the future of commodity X, see problems coming, and so begin to reserve the current supply (for future use). We should thank them. It’s rare for them to earn anywhere near what Obama thinks – and when they do, they deserve it. Their action contributes to future supply, both by reserving current supply and by sending a powerful signal (the higher price) that there is a problem and things need to change.

    As the saying goes, ‘the cure for high prices is… higher prices’. Higher prices and so-called ‘windfall profits’ (Apple, anyone?) give everyone a signal about where more investment is needed. The investment pours into producing that thing and, in time, production rises… causing prices to crash. In other words, high prices cause lower future prices – if markets are allowed to do their work is. That is how the market-price mechanism works, or what it is “for”. Or, as Wapo puts it:

    At issue is the increasing role of investment in oil futures contracts by pension funds, mutual funds, hedge funds, exchange traded funds and other investors. Much of that money is betting that oil prices will rise… At the same time, investors can also bet that prices will go down — indeed, speculators have been credited for low natural gas prices…

    But Obama can’t tolerate it. Natural price action resulting from people’s behavior in markets is not permissible – especially not if it threatens Obama’s re-election, in other words, his power. In other words: Human freedom and government power are opposites, and government can’t permit freedom.

    Obama said the plan would put “more cops on the street” to catch speculators who attempt to manipulate markets for their own profit.

    But who would that be? Who in heck is he talking about? George Soros, perchance?

    Market Theory and Practice 101 teaches that it is impossible for anyone to manipulate free markets, for more than very short time frames. Only bad government policy makes significant (in time) manipulation possible.

    Furthermore, how are “speculators attempt[ing] to manipulate markets” to be distinguished from a wise and foresighted person hedging against the expected future cost of oil/gasoline? Their behavior is the same. There is no objective way to separate them.

    And that is the real point: Obama wants the government to have more power, period. He wants a situation where any market participant can be *arbitrarily* designated a criminal, at any time. That increases The Party’s power.

    “The president has all the tools available to him if he believes that the oil market is being manipulated,” Boehner told reporters Tuesday. “Where’s his Federal Trade Commission? Where is the SEC? He’s got agencies there. So instead of just another political gimmick, why doesn’t he put his administration to work to get to the bottom of it?”

    Yup. But let’s move to the next wrong thing:

    Senior administration officials who put together the proposal stopped short of blaming market manipulation for rising gas prices, but said they wanted to curtail the ability of speculators to take unlawful advantage of oil price volatility. “The price is affected by a variety of factors,” said Brian Deese, the director of the White House’s National Economic Council. “Obviously, instability in the Middle East…”

    … Analysts say it is *possible* [emphasis added] that… speculation has somewhat inflated the price of oil… [but] Studies of the effects of speculation on oil markets indicate that it… doesn’t have a major effect on average prices.

    In other words: THERE IS NO CLEAR PROBLEM; THERE MAY BE NO PROBLEM AT ALL. Yet Obama is proposing More Government, anyway. Because that’s how he rolls. He proposes More Government on the basis of… nothing. No facts, no evidence.

    Either speculators have an influence on oil prices, or they don’t. Obama’s economists and others are saying, in essence, that they don’t. That’s one point against Obama. But if they do, it’s probably a necessary and good influence in the long run. That’s point two. Which is it? I don’t know, but either way, Obama is wrong.

    Finally, may I say that I saw this coming:

    I’m sure Obama knows all this, and that we will be treated to speeches about evil speculators…

    Comment by ILoveCapitalism — February 24, 2012 @ 1:41 pm

    In other words – and the following is directed at our leftie commentors – My understanding of Obama lets me predict where He’s going, just as my understanding of reality in general enables me to see many things. Does yours? “Got foresight?”

    Comment by ILoveCapitalism — April 18, 2012 @ 11:00 am - April 18, 2012

  7. P.S. Another cruel joke here is that Obama is proposing to rein in evil, supposed speculators by expanding the power of the CFTC (Commodities Futures Trading Commision).

    The CFTC are the clowns who let Jon Corzine rip off hundreds of millions of dollars from his own customers at MF Global. They should be on trial, along with Corzine. So Obama wants them, specifically, to have more power… natch.

    Comment by ILoveCapitalism — April 18, 2012 @ 11:04 am - April 18, 2012

  8. Among the many, many delusions of the left is the belief that things ought to cost something other than what people are willing to pay for them.

    Comment by V the K — April 18, 2012 @ 11:18 am - April 18, 2012

  9. I’ll mention Bill Nelson again because oil speculation is one of the bogeymen he’s been trotting out in his fear mongering campaign. This embarrassing video comes from an email with the subject “Cracking Down on Oil Speculators:

    http://youtu.be/Rz3kysPnudU

    I wonder if he recalls who was POTUS in December 2000. And then, presumably, this went into effect on January 1. So in about 7 months, the relaxed regulation of oil speculation led to Enron’s accounting scandal? How does that work, exactly?

    Comment by TGC — April 19, 2012 @ 3:41 am - April 19, 2012

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