Friday, April 28, 2006

The Melodrama Over Oil


Jumping on the Bash Big Oil Bandwagon

I can't even begin to tell you how sick I am of people blaming Big Oil for high gas prices. I did a post on this in November entitled The Scandal of Supply and Demand. Many of my arguments in that post are still the same. Bill O'Reilly is upsetting me more and more with his hysteria over how evil the Oil companies are. I agree with him about 70% of the time and on the Sex Offender issue he's right on. But on the oil companies he's way off base.


So who is my hero on this issue? Neil Cavuto!! He took on Dick Durbin on his show and crushed him like a bug. Go here to see the video. (You need to forward about halfway through to see the good part.) Here are some of Neil's questions to Durbin:
"Senator, do you think with your zeal to save the environment, and some of these blended fuels that we have to have in order to meet these new environmental requirements, that, with the best of intentions, you're the one who is gouging Americans at the pump?"

"Do you know how much, out of curiosity, senator, is billed into a gallon of gasoline, profits of the oil companies, per gallon? Do you know what's the average?"

"Maybe you could answer my question. It's about 9 cents. Do you know how much taxes are, senator? About 50 cents."


"So, don't you think you should be more focused on the tax- gouging than necessarily the profit-gouging?"

"So, 50 cents a gallon, those taxes are okay? The nine-cent profit, that's not okay?"

To see the rest of the transcript go here.

And to be honest this is one of those times when I'm upset with not just Democrats on this issue but also Republicans. I know it is an election year and everybody is scrambling. But this is a time to educate the American people on the concept of Supply and Demand and the benefits of a free market. It is not time to pander and to jump on the bash Oil Companies bandwagon.

So what is the real reason for high gas prices?

1) No new refineries in the U.S. in 30 years

Nick who works for an evil oil company :-) wrote an excellent post entitled: It's All Big Oil's Fault. Here is an excerpt:
"There has not been a refinery built in the United States in 30 years. Business and start up taxes, along with increased environmental regulations and the fact that not many states want a refinery, means that oil companies are not building new refineries to handle the increased demand for gasoline. Oil companies can produce all the oil and gas out of the ground they want, but limited refineries means limited production of gasoline. Liberals want it both ways. They want low gas prices but no more facilities built to refine the crude oil into gasoline. How in the hell is that the fault of Big Oil?"


2) No new drilling in the U.S.

Another great excerpt from Nick:
"Ten years ago, liberals said that drilling in ANWAR was not worth the “environmental disturbance” because the oil would not be ready for consumer use for 5 years. 5 years ago, liberals still said drilling would do no good because the oil would not be ready for consumers for 5 years. Now, today, those same morons are complaining that drilling in ANWAR would do us no good because the oil would not be ready to use for 5 years. Well, what if we had started drilling 10 years ago? That oil would be ready for gasoline consumption certainly by now. But, it’s too late to start now, right? After all, we’d have to wait 5 years to use it.

ANWAR is over 19 million acres. The proposed acreage that would be used for exploration is about 20,000. That is like placing a regular postage stamp on a football field. Exploration would not ruin the refuge. As a matter of fact, warmth from pipelines has actually been proven to become a mating spot for wildlife and fisheries. Just ask any offshore fisherman about the best places to fish, and he will tell you about fishing along rigs for snapper.

Also, what ever happened to states’ rights? ANWAR is in Alaska, is it not? Rather than having a bunch of tree huggers in California and Massachusetts decide ALASKA’s economy, why not allow ALASKA’s citizens to vote on the drilling proposal. Most of the citizens of Alaska want some exploration in ANWAR, to provide jobs and revenue to benefit the state’s economy. Let’s do things the DEMOCRATIC way. Let ALASKA vote, not politicians who live 2,000 miles away."


3) Government Taxes

As Neil pointed out the average profit of oil companies is 9 cents per gallon whereas between state and federal taxes it is 50 cents per gallon. Who is really doing the gouging? And now Democrats want to tax Oil companies even more with their windfall tax. Who do you think ultimately pays the price for higher taxes? The consumer.

Who is to blame for these reasons?

Environmentalist whackos and liberals!! I can't tell you how upset I have been over the liberals blocking the Anwar bill. Everytime we drill in the U.S. we lessen our dependancy on foreign oil. But we can't do that if environmentalist whackos and liberals keep thwarting our efforts. We also can't build new refineries if the environmentalists don't lessen their restrictions. I would think these high gas prices would be our wake-up call to all of this. But again instead of using this as a platform to educate the American people everyone is jumping on the bandwagon.

It is time to wake-up and start coming up with long term solutions. Raising taxes or trying Jimmy Carter regulations is a death sentence that we need to avoid. Let's build new refineries, drill in the U.S., find new alternative energy sources and then let the free market of supply and demand continue unhindered.

Sources & Other Excellent Posts and Articles on This Subject:
Kudos to Cavuto on Destroying Dick Durbin
Oil & Tax Maps--Mike's America
Cartoon--Cox & Forkum
It's All Big Oil's Fault--Nick
Gas Taxes are Too High--Mike
Oil Profits Go Up and Down, Gas Taxes Only GO UP!--Mike
Oily Politicians--Thomas Sowell
IT'S HARD OUT HERE FOR A PUMP--Ann Coulter
Those Evil Greedy Oil Companies--Patrick
A Little Research--Nick
Oil Price Solutions--Mark

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