Now that 87 octane has topped $4.50 across most of the country, more Americans are becoming aware of the economics of energy. Of course, we are still being lied to about the basic, undeniable reason for the price surge — America’s refusal to harvest its own energy. Democrats led by Barack Obama continue to berate Big Oil and threaten to impose higher taxes on that industry or, in the case of Maxine Waters, nationalize the whole kit and caboodle. Either course of action would lead to fantastic price increases. Big Oil will not, can not, and should not, operate at a loss.
Here’s some news for Rio Linda residents and their kin. Oil profits have averaged about 9% overall during the last 5 years. Americans hear only about record Big Oil profits, but other records are being set every year as well. Big Oil pays about 2 1/2 times its profit in taxes and fees every year, topping $100 billion in 2007. That’s a record. Industry gross profits, payrolls, exploration and distribution costs, and volume of product processed are also at all-time highs. That’s what happens with a successful business — it grows! Barack Obama is not telling you the whole story, but just enough to get uninformed, mentally-challenged lemmings to vote against their best interests.
It is Democrats who block drilling in ANWR and off-shore. Democrats block the construction of hydro-electric dams and oil refineries. Democrats voted to ban the harvest of shale oil, this nation’s richest potential source of energy, dwarfing Saudi Arabia’s proven reserves. Democrats block construction of more nuclear facilities. Hello, is this thing on?
The left is even opposing solar and wind power projects, according to a Press-Enterprise article on June 3rd. It seems the Sierra Club has concerns about the visual impact of wind turbines and transmission lines. Greenies want the wind machines “on the roofs in Los Angeles.” I’m not kidding.
Proposing policies designed to harm an industry providing vital products and services Americans need is more devilish than first meets the eye. Yes, the Democrats are pandering to Americans too stupid to pass Econ 101. Yes, bashing Big Oil is therefore a smart political move, designed to attract voters who fail to grasp the rudimentary elements of free-market transactions. But something deeper and more sinister is behind the obviously false accusation that Big Oil is gouging American consumers. The cold fact is that the radical left wants extremely high gasoline prices, believing that exorbitant energy costs will reduce consumption, which will reduce greenhouse gas emissions, which in turn will save the planet. That the strategy will fail to meaningfully impact demand is of no consequence to the green crowd. What’s important is the attempt to do the right thing. Intentions, not successful outcomes, always drive the left.
The strategy will fail because America needs energy, and the demand for energy will increase every year. It always has and always will. The most optimistic forecasts for replacing oil-based energy to any significant degree consistently project goals decades down the road. For the next 30, 40, 50 years or more America and the rest of the world will depend on petroleum as a primary source of power. Demand will continue to grow despite high prices. If the supply of crude oil and refining capabilities do not keep pace, it’s the little guy, many of whom will foolishly vote Democratic, who will feel the pain at the pump most acutely. It’s the little guy, not the fat-cat Democrat politicians nor the elite environmentalists, who will receive pink slips due to the economic slowdowns caused by fabulously and unnecessarily high energy costs.
The good news is that average Americans are increasingly aware of the left’s Stalinist tendencies. Barack Obama will tell us what size car to drive and how cool we can keep our homes. Believe me, that’s just the start. In the name of planet preservation, wealth redistribution, and equality of outcome, the left will attempt to control everything from our health care to the light bulbs we use. Think I’m kidding? If you haven’t viewed the accompanying video, do yourself a favor. While Americans stagger under suddenly burdensome fuel costs, Democrats have mandated the use of light bulbs containing mercury and made exclusively in China.
It’s one for the books. Vote Republican this November.
Posted by Jerry Pomeroy in Campaign 2008, Cultural Insanity, Economics, Energy, Video