May 22, 2008
A Modest Campaign Proposal...
...for the man who really is a conservative, after all!
John Hinderaker (I cannot stop thinking of him as "Hindrocket," no matter how the lads try to bury the past) has a wonderful post up at Power Line: Oil Executives Try to Educate Senate Democrats, But Democrats Appear Hopeless. It's an eye-opening primer on the oil biz and the relationship between prices at the pump and the price that American oil companies must pay to buy foreign oil, since congressional Democrats refuse to allow them to drill in the United States. Not only that, but it's even longer than its title!
Here is how John ends his post, quoting from the transcript of the Senate hearing on gasoline prices, to which many top executives of Big Oil were invited -- including John Hofmeister, president of Shell Oil:
Later in the hearing, Senator Orrin Hatch walked Hofmeister through the Democrats' latest efforts to block energy independence:
HATCH: I want to get into that. In other words, we're talking about Utah, Colorado and Wyoming. It's fair to say that they're not considered part of America's $22 billion of proven reserves.
HOFMEISTER: Not at all.
HATCH: No, but experts agree that there's between 800 billion to almost 2 trillion barrels of oil that could be recoverable there, and that's good oil, isn't it?
HOFMEISTER: That's correct.
HATCH: It could be recovered at somewhere between $30 and $40 a barrel?
HOFMEISTER: I think those costs are probably a bit dated now, based upon what we've seen in the inflation...
HATCH: Well, somewhere in that area.
HOFMEISTER: I don't know what the exact cost would be, but, you know, if there is more supply, I think inflation in the oil industry would be cracked. And we are facing severe inflation because of the limited amount of supply against the demand.
HATCH: I guess what I'm saying, though, is that if we started to develop the oil shale in those three states we could do it within this framework of over $100 a barrel and make a profit.
HOFMEISTER: I believe we could.
HATCH: And we could help our country alleviate its oil pressures.
HATCH: But they're stopping us from doing that right here, as we sit here. We just had a hearing last week where Democrats had stopped the ability to do that, in at least Colorado.
HOFMEISTER: Well, as I said in my opening statement, I think the public policy constraints on the supply side in this country are a disservice to the American consumer.
The committee's Democrats attempted no response. They know that they are largely responsible for the current high price of gasoline, and they want the price to rise even further. Consequently, they have no intention of permitting the development of domestic oil and gas reserves that would both increase this country's energy independence and give consumers a break from constantly increasing energy costs.
Every once in a while, Congressional hearings turn out to be informative.
Informative and also prescriptive; I think this would be a dandy centerpiece to John McCain's campaign, the core of his energy program: Lower gas prices by letting American oil companies drill for American oil on American soil.
How will the argument go between McCain and Barack Obama? Something about like this:
McC: We should allow American companies to drill in the Atlantic, the Pacific, the Gulf of Mexico, Alaska, and start expoilting shale oil in the West.
BHO: But that will produce pollution.
McC: No more than the pollution produced by burning the same quantity of foreign oil.
BHO: But that will increase global warming!
McC: No more than the global warming produced by burning the same quantity of foreign oil; the only difference will be more good, high-paying jobs for more Americans. Does my opponent have something against job creation? Or something against lower gasoline prices, when companies are spending $40-$50 a barrel to develop our own oil, rather than $135 a barrel to buy it from the Saudis, from Iran, and from Venezuela?
BHO: Yes I do -- lower prices mean that Americans will buy more gasoline. And lower gasoline prices mean lower food prices, so we'll buy more food. With lower prices overall, our economy will have a boom... which means we'll use more of the world's resources, which we already hog. After all, we can't drive our SUVs and eat as much as we want and keep our homes on 72 degrees at all times ... and then just expect that other countries are going to say OK. [The blue part is an actual Obama quotation.]
McC: My friends, there you see the difference between us. My fellow Republicans and I want to see America thrive and our economy grow, creating more jobs for Americans and more wealth and prosperity for everyone. But my opponent would rather create a "global test" for the American economy to pass, where Europe and Asia dictate how much Americans are allowed to consume.
So you have a stark choice: You can vote for jobs and prosperity -- or you can vote for limits, cutbacks, making do with less, and bowing our heads before the rest of the world, both economically and militarily. When you step into the voting booth, that is what you're really deciding.
If McCain were to pound on this theme from now until November -- let us drill for American oil on American soil -- I believe he would crush Obama like a butterfly against a speeding windshield.
And by the end of campaign season, Democrats would be begging the Market gods for gasoline prices to plummet! That alone would be worth the trip.
Hatched by Dafydd on this day, May 22, 2008, at the time of 1:43 AM
TrackBack URL for this hissing: http://biglizards.net/mt3.36/earendiltrack.cgi/3029
The following hissed in response by: Davod
Common sense is no an option. McCain has already bit of the Global Warmening tree.
The following hissed in response by: Steelhand
Read this this AM, prior to coming to BL. (Sorry, Dafydd, that's my habit.) This is crucially important information that virtually none of the American public will ever know.
We've been sold the meme that Oil companies are making massive profits causing distress to the American public. We've been sold the meme that "Bush's buddies" are making these profits, and that's why we are at war in Iraq. An we've been sold the meme that there's nothing we can or will do to bring down oil prices to bring down gas prices, since Bush is tight with Saudi Arabia.
The answer is local, right under our soil and water. We can drill for more oil here. We can expand our refining capacity. We can raise supply to meet demand, a demand exacerbated by rising econcomies in Asia. A change in our environmental policy re oil will create many good paying jobs. The only possible response from OPEC would be increased production and price drops to make our drilling less attractive. But even that would help US consumers.
We must face down the environmental extremists who keep down the only policies that can reduce US dependence on foreign oil, thus securing ourselves economically.
The following hissed in response by: KarmiCommunist
Great post! Maybe at $8-a-gal we'll finally start drilling for our own, and getting past the radical environmentalists won't be so difficult. Nuke plants would be another project to start.
It makes no sense to be paying this much for oil/energy to countries that support terrorism (yes, we get most from Canada, but that’s relative), when we have more oil (if oil shale is included) than the Middle East. BTW, Canada develops its oil sands (which we also have). Shell oil must suspect something to change, since they have been buying land and water rights in Colorado.
The above hissed in response by: KarmiCommunist at May 22, 2008 7:17 AM
The following hissed in response by: David M
The Thunder Run has linked to this post in the - Web Reconnaissance for 05/22/2008 A short recon of what’s out there that might draw your attention, updated throughout the day...so check back often.
The above hissed in response by: David M at May 22, 2008 9:34 AM
The following hissed in response by: Eilish
Wow, very informative post here and at PL. Thanks for the info.
The following hissed in response by: Baggi
If McCain started talking like this he would get all the conservative republicans on board in a snap.
Unfortunately, he against drilling for oil on American soil. He's against ANWR.
It's a shame really, because it is a national defense issue. But there it is.
The following hissed in response by: hunter
High prices mean low supply.
Congress is refusing to do anything about supply.
The following hissed in response by: Don
"where Europe and Asia dictate how much Americans are allowed to consume."
Obama is completely correct, Dafydd. I have lived in Europe for many years now and one thing is clear; Europeans are veritably godlike in their powers, and therefore far more competent to determine what is in the true interests of the planet than any American can possibly be. No American politician ought to be allowed to set policy for the United States - that power should be reserved for the wise councils in Bruxells and Strasborg alone to determine.
The following hissed in response by: Steelhand
Helpful information for those who like some data to pore through. H/T to Sanity Inspector over at Protein Wisdom
The following hissed in response by: cdquarles
I'd add one more thing. No more tightening of "pollution" regulations. We are already so far past the point of diminishing returns that we could loosen all of them by an order of magnitude (a factor of 10 for those in Rio Linda) and not notice the difference in environmental quality or quality of life.
The above hissed in response by: cdquarles at May 25, 2008 6:59 PM
The following hissed in response by: Dafydd ab Hugh
Well, the main point is that McCain must recognize that this is the jackpot campaign issue, the one that would allow him to put Obama away by nine points: John McCain favors drilling for oil, Barack Obama favors an energy and food "global test" to satisfy Luddite European leftists.
McCain, who has a history of opposing drilling, is going to have to throw the Straight-Talk Express into reverse gear; or perhaps it would be more appropriate to say that it's been in reverse gear all this time, and he has to throw it into Drive instead: McCain has to come out and say that the technology has changed (or at least he now understands how much it changed over the past dozen years), and we're in a national emergency, and now it's time to start building more refineries and drilling everywhere... In ANWR, in the Gulf of Mexico, off the coast of California, in the Caribbean and in international waters. And it's time to start refining shale-oil.
If we did that, we would move from being one of the least consequential petroleum powers to one of the largest and most important. We can produce oil for about $40 a barrel (vice $135 a barrel to buy it from the Saudis, from Iran, or from Venezuela), sell it at the pump for a profit at $2.85 a gallon, and sell to the world oil market for full price... which will drop but still be very profitable.
It's time, John; don't cede this vital domestic issue to the Democrats! Get off the stick and on the hump, and start pounding the cable for drilling and new refineries and more nuclear power plants.
It's a magnificent wedge issue between the lefty Democrats and the moderate Dems and the Independents. And it would actually be a huge boost to America's national security.
And what a blow to strike against the terrorist-supporting states, to massively increase supply, thus driving the price of sweet, light crude down below a buck a barrel!
The above hissed in response by: Dafydd ab Hugh at May 26, 2008 3:14 AM
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