It's no secret that Obama wants to lower the level of prosperity in the country. He knows that you cannot lift the bottom income earners up, so he wants to bring the top down. From universal healthcare to higher taxes on the super earners to higher prices at the gas pump, Obama has consistently tried to find ways to "spread the wealth' as he famously said during his campaign. This past week, in response to rising gas prices and growing noise
about needing more drilling, Obama pulled out a chart that shows the
percent of oil imported fell below 50% in 2011, the implication being
that he's done something to encourage that trend. He also said that we
cannot drill our way out of the current gas price spike. He's wrong on
both accounts, but probably not for the reasons he would like us to
believe.
Drilling now will not help the current gas
prices, this much is true. We needed to be drilling two, three years
ago to have enough production today to effect a price reduction, and
Obama has already made his stance on drilling clear. The current spike
in prices is due primarily to unrest in the middle east, which Obama has
steadfastly encouraged. Whether it was by NOT supporting the popular
rebellion in Iran after their elections, allowing hard line Islamists to
remain in power, or supporting chaos in Egypt, Libya, and elsewhere,
thereby letting hard line Islamists like the Muslim Brotherhood gain a
toe-hold, Obama's foreign policy has helped keep oil prices at record
highs despite reduced demand resulting from the recession. Even without
new permits (more on that later) US oil production is slated to
increase by 2 million barrels per day. This is primarily due to the
10-year permits issued by the Bush administration for drilling on
federal lands (which makes me wonder - why doesn't Obama publicize his
'inheritance' of increased oil production?). If we can get approval to
complete the Keystone pipeline, that will add another 1 million barrels
per day from Canada. Combined, these 3 million barrels per day would
allow us to stop imports from Saudi Arabia, Venezuela, Ecuador, Russia
and Algeria, thus removing much of the uncertainty about our sources of
oil, and hence the ability of speculation to drive the price.
To
that end, according to Peter Morici, former chief economist at the US
International Trade Commission, the oil produced domestically is $17 per
barrel less than oil produced elsewhere. This indicates that the North
American oil market is detaching from the global market, and increased
drilling coupled with the completion of the Keystone pipeline will have a
significant impact on gas prices. This can point to only onbe
conclusion:
Gas Prices Are Purposely Being Driven Up
It's interesting that we have an incumbent president who cares so
little about re-election that he's purposely driving gas prices higher,
but there it is. Every time you pay more at the pump, it's because
Obama wants you to. Four years ago, Democrats in Congress were livid
about gas prices, demanding that George Bush do something about it.
Today, they keep repeating the canard that the President can't affect
prices, but as we reviewed above, Obama has taken direct action (or
inaction, depending) to destabilize the middle east, has directly
stopped drilling, and though he says he has lifted the moratorium on
drilling, the issuance of permits is down 57% from before the
moratorium. When the Bush admin's 10 year permits expire, domestic production will plummet.
But perhaps most damning is this quote: "Somehow we have to figure
out how to boost the price of gasoline to the levels in Europe." This
was from Stephen Chu in 2008. It's an important quote, because in
January 2009, Chu became Obama's Secretary of Energy. So not only is
Obama's 'diplomacy' driving up gas prices, his guy behind the scenes has
been overtly rooting for higher gas prices for the last four years, and
since this summer is looking to be a record setter in terms price
levels, it looks like he is going to get his wish.
To help
in this gouging of the American public, Chu is calling for an end to
more than $10 billion in oil company subsidies, while pumping more and
more money into alternative energy companies like Solyndra, which then
frequently go bankrupt. He's also pushing vehicles like the Chevy Volt
(with a $7500 per car government subsidy) despite the fact that there is
no demand for the product (as evidenced by GMs recent furlough of 1300
workers while they idle the Volt's production line due to lackluster
sales). It seems that even when engaged in meddling with the market and
picking winners and losers, the government's winners ARE losers.
Chu's
methods are necessary to get a market for alternative fuels off of the
ground. The only way to make alternatives fuels and AF vehicles
attractive is to make, well, all the decisions this administration has
been making. Encouraging unrest in the middle east, saying 'no' to the
Keystone pipeline, placing moratoriums on drilling (not approving
permits when the moratoriums have been lifted is really the same as
having a moratorium), and enforcing year long reviews of any energy
projects on federal lands; every step of the way, there's more red tape,
there's more delay, and there's more cost. Obama wasn't lying years
ago when he said "under my energy plan, costs would necessarily
skyrocket."
What is the solution? I'll get into this in part 2 tomorrow!
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