We have more oil on hand today, in this country, than we had in 2003 when the average, inflation-adjusted price of crude was $32.34 per barrel. At the same time, estimates of world-wide oil product demand are being reduced by the International Energy Agency while the global supply is rising.
Furthermore, according to the "Official Energy Statistics of the U.S. Government," motor gasoline consumption in the U.S. was lower in the early months of 2008 than it was back in 2003, and the same goes for jet fuel consumption.
So, why are we being barraged by a fusillade of disinformation from our leadership? For an administration peppered with alumnae from the oil patch it should know better than to try to so obviously mislead the public.
In particular, one has to wonder then why Bush said, on March 5, according to the AP, "It should be obvious to you all that the [gasoline] demand is outstripping supply, which causes prices to go up."
This outrageous departure from the facts prompted automotive expert Ed Wallace to ask, in a two-part article that appeared in Business Week in April, if the president was reading the official data produced by his own government.
But it seems to be more of an intentional pattern than an oversight. Energy Secretary Sam Bodman chimed in on the same day as the president, according to Bloomberg News, saying: "They see speculation in the market, I see decline in global inventories. I don't think this is a big surprise, that we've had a jump in price when there has been a decrease in crude inventories."
A "decline in global inventories?" Okay, let's get very specific here. According to the International Energy Agency, the global oil supply was 87 million barrels per day in the first quarter of 2008, up from 85.4 million in the first quarter of '07, which was up from 85.35 million in the first quarter of '06, which in turn was sharply up from the 84.2 million in the first quarter of '05.
The Business Week articles in April reported that worldwide production of oil rose 2.5% in the first quarter of 2008, while worldwide demand grew by only 2%.
And, in case you might think Bodman was referring only to the situation in the U.S., the weekly statistics released by the Energy Information Administration showed oil stocks in the U.S. to be rising during the week that the above comments were made, from 305 million barrels to 312 million barrels. The most recent figure, for last Friday was 302 million barrels.
And, as mentioned above, these reported stocks are higher than for any week in 2003.
Yet, the disinformation campaign continues. On May 17, USA Today quoted White House spokesman Dana Petrino as saying: "We have not enough supply, and too high demand. Trying to get more supply out there is good for everyone."
And, in the same article, National Security Advisor Stephen Hadley said: "The President has said very publicly that the problem of high oil prices isn't going to be fixed over night. We have to address the underlying problems in the market. We have to make investments to increase production."
More production translates into more money for the oil patch, and at artificially high prices to boot.
It appears the only source of information to be at least partly trusted may be the OPEC cartel itself. OPEC reported in March that the world was well supplied with oil, according to the AP, and it blamed speculators and mismanagement in the United States for the high prices.
At that time, OPEC declined to raise production levels although Saudi Arabia, in an apparent gesture aimed at the United States, increased its production by a very small amount in May.
It may come as a surprise to some that the price of oil can be bid up by investors who have no intention of using what they are purchasing, but that is exactly what has been going on in the pits of the commodities exchanges in Chicago and New York, and it is exactly what OPEC was referring to.
And part of OPEC's "mismanagement" accusation may refer to the U.S. administration's pretense that it knows nothing about this aspect of the equation and, therefore it can obviously do nothing to control it.
Does anyone see a pattern here? The mortgage crisis in the U.S. developed largely because the finance industry was allowed to proceed unregulated into what might be called the stratosphere of imprudent investment strategy.
The non-profit, non-partisan advocacy organization, Common Cause, sees a connection between Congress' hands off policy and the fact that the mortgage lending industry's donations and lobbying expenses directed at Congress and the political parties amounted to $32 million last year and $187 million between 1999 and 2006.
The result of the lack of regulation was, of course, the creation of a massive bubble in the real estate market which has now popped, with negative consequences for the economy.
Now, we are talking about an oil crisis that appears to have been largely caused by another sector of the financial market which has had the luxury of garnering enormous profits off the backs of this nation's users of oil. And again, arguably, while Congress and the administration might have injected a little regulatory restraint into the situation, they opted to turn their backs and do nothing. Had they acted, they just might have dampened the demand and initiated a similar movement affecting other exchanges around the world.
And again, one must wonder if the $25 million the petroleum industry donates to Congress and the political parties each election cycle might explain the hands off approach.
In any event, the result appears to be another massive bubble, although in this case the agony is being felt up front, and the relief will be experienced only after it eventually pops.
In the meantime, if you're by any chance interested in creating a hedge against continuing oil price increases, even though oil dropped over $2 per barrel today, you might consider putting some money into a commodities fund if, in fact, you are fortunate enough to have any money at all to invest.
And then, you too, can become part of the problem in this crazy, topsy-turvy world we live in. But, beware of the "pop."
Dave McGill, News Correspondent
Dave's column, "The Contrarian," generally published every Friday, to Gather Essentials: News will sometimes present a contrary view to various aspects of the news, or an alternate take on the conventional wisdom of the day, and will occasionally appear on other days of the week
Dave has been a senior officer of a large eastern insurance company, involved in economic projections and investment strategy, president of a Midwestern mortgage banking company, and a financial consultant in Southern California, serving clients in the field of commercial real estate development
You can find all of Dave's "The Contrarian" columns at: http://gather.com/thecontrarian...... Keep up with Dave's other postings and Gather activity by joining his Gather network - just click here: http://atadaskew.gather.com........ You'll find Dave and other News Correspondents, plus celebrity content and plenty of other News experts at News.gather.com.
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Comments: 98
It doesn't matter whom we elect. It doesn't matter what laws get passed. It doesn't matter what agencies attempt to enforce the laws. It doesn't matter how technology changes the sources of energy. It doesn't matter whether our money is "backed" by gold, silver, or moombeams (our current backing).
Please read Invisible Hand and understand what is happening and has been happening for thousands of years. (Yes, they had inflation and real-estate "bubbles" in Bible days, too.) That novel will help you understand and also provides a complete, once and for all solution to the problem. Yes, a new form of money never before even contemplated. Yours at no cost.
I see larry's still self promoting all over gather.
The actual idea of the FED and the realestate bubble, the price of oil, the cost of two wars etc is the Bankrupt the United States. No group or country or even coalition of countrys could take the US on the battlefield so they are doing it through economics.
Before they are through there will be a NAU and a new NAU money some say will be called the AMERO. We the people will be so desprite that we will Demand both.
Have you read, Invisible Hand, Don?
I'm so happy that Laryy thought of the idea, as well as took the time to write it and put it out there for me, and others like me, to find. Believe me. I was searching!
Laryy's idea has given me hope, and enthusiasm. I'm going to keep helping to spread the word. It's not a pipedream. It's the hope of the future. If it is not acieved in my lifetime, it may well be in my children's or grandchildren's.
I'm looking forward to this.
Democrats oppose:
Nuclear energy
clean coal energy
drilling for our own oil
Democrats support:
Suing OPEC
taxing American oil companies
demanding OPEC pump more oil
Democrats aren't part of the solution they are part of the problem. It is arrogant to assume America has complete control of oil and it's prices since most of it is produced in other countries and democrats oppose it here.
So, why are we being barraged by a fusillade of disinformation from our leadership? """"
You obviously think America is the beginning and the end of everything. Ever consider India's and China's booming economic growth that has changed the fact that we really lost control of petro energy prices? Do your research Dave!
I'm aware that companies like Baker Hughes International and Haliburton buy oil from the futures market, but they take delivery and stockpile it for later sale, and that sort of thing really can't be stopped because they take delivery. However the speculators that have no intention to take delivery can be stopped.
Good article Dave, this is a difficult arena and it will be very hard to stop.
http://alexander.senate.gov/public/
And gas went up again today...now @ $4.25/gal. Wonder what it will be next week? Supply and demand? Soon there won't be a demand, no one can afford it.
Thanks for the information and appreciate the time and research that took! This reminds me of the "oil crisis" in the seventies when gasoline was rationed. They were storing gasoline in closed stations because they actually had too much to store in the tank farm and the tank farm was virtually overflowing. Someone said at the time "there is a true shortage of .37 per gallon gasoline, but there is a lot of .75 per gallon gasoline and that was the exact case.
I believe we do need to drill wherever we can and agree that is not the long term solution. However, if it will free us from Mideast oil any sooner it will be worth it. And every president since Carter is guilty of failure to address this obvious problem in a meaningful way. The need was obvious after the embargo and there should have been a Manhattan project or moon launch type effort to develop and utilize alternative energy sources. Had this been done by Regan, we would not be in the situation we are today and probably not in Iraq, either.
Who dares question unrestrained government and THEIR greed? Ever stop and think how much the government take on oil consumption in the U.S is? Taxes on oil solidified it as our primary energy supply. The government takes more revenues from oil tax than the entire U.S military budget. That doesn't even count what the politicians get for their lush campaign contributions.
"""" I would imagine that demand has gone down a lot more than reported, as well. This administration has been actively playing with figures on many unflattering fronts for years. """""
Once again you are talking about America. With the rising middle classes of China and India not only has demand gone up but futures demand. You liberals act as if America can control everything with a switch. Global warming, poverty, religious conflicts abroad, gas price, education.....etc.... You spend so much time glorifying yourselves and others who agree with you that you never stop and think that good intentions don't solve problems. You never want to find the root cause to problems because you are obviously too afraid that the truth will hurt.
I couldn't have characterized you any more accurately, my conservative, misguided friend, if I had tried. Lied to and brainwashed, unable to see the truth when it's sitting in front of you. You talk about the unrestrained government, while your party has grown it beyond all recognition, You worry about Democratic taxes, up front, when the Republicans have levied the most repressive tax ever, by pursuing moronic economic policy and devaluing the worth of every person in this countries savings through the devalued dollar, and it goes on and on. You're a moron to continue to put your faith in those elitists. Dems aren't much better, but there is a difference in who they favor.
" Who dares question unrestrained government and THEIR greed?"
Well, the last eight years, it's been the liberals. Conservatives were too busy feeding at the government's trough.
Why do liberals dismiss clean coal as an an "oxymoron" every time it is brought up? Why do they hate nuclear energy? Why do they hate the thought of drilling for the oil America has? Why do they hate every alternative to energy but think taxes and congressional investigations will solve everything? Please tell me.
""" " Who dares question unrestrained government and THEIR greed?"
Well, the last eight years, it's been the liberals. Conservatives were too busy feeding at the government's trough."""""
I agree totally. But every federal spending bill passed by republicans was castigated as "NOT BEING ENOUGH!"
If George Bush and Dick Cheney walked into the office of some of these sycophantic defenders of everything they do, and took a big steaming dump in the middle of their desk, they would still believe them when they blamed liberals for the smell in the office.
Some people want to be suckers.
Excellent liberal tactic even for a second class canuck. Bring WMDs and the 5 year predicted "collapsed economy" into the energy discussion. I mean think about it. Ever since John Kerry we're supposed to be in a recession but it never quite materialised despite liberal hope. We finally have an adjustment in the real estate bubble and we have higher energy costs and now, according to a canuck, our economy is collapsed. I feel like I am a spectator of Saturday Night Live!
That is the classic liberal view. On paper there is no real supply problem because on paper we are looking at TODAY not tomorrow.. But investors speculate that the booms in the middle classes of India and China are growing beyond what Rory could comprehend......a term called growth. So they are buying up all available oil NOW because the demand today isn't going to be the demand in 2 years! Open your eyes!
And yes, the futures market needs to regulated, as does the mining industry as do a lot things. Hell, I'm a capitalist but view price gouging as illegal.
scam.
The free market isn't working -- these people need some over site. The only "invisible hand" you are going to notice is the one in your wallet taking your cash.
I agree with Richard B., if someone wants to play in the commodities market, let them take delivery -- or else cap the amount they are allowed to "invest".
Yes, this is political and economic and not as much of an oil problem as some would have us believe.
But we should be buying hybids and decreasing our dependence on foreign oil.
First, I'm not a Democrat, I'm an Independent, and a some issues liberal, but stand with the Dems, till the Republican party comes up with solutions, not additions to the problems. Democrats, generally have done much less harm to the middle class, of which I am a member, Republicans have jap slapped us around for eight years, to the benefit of the rich and elite, and want to extend that record. American speculation has been what has driven this market, no matter how you want to minimize that greedy bunch, and as JOhn P. says, this is too important a commodity for our country to have speculators running the price up prematurely. Slap oil speculation down in this country, and you will go a long ways to quieting the market as a whole. We are the biggest consumers TODAY, and we are spurring this mess.
Uh, Jeff, I think it's been a lot more centered on where that federal spending was targeted to go. Conservatives insisted on bridges to nowhere, while cutting funding for all humanitarian programs in this country, such as the school breakfast program for inner city children, that they callously eliminated, even though it was a scientifically based program that allowed children to learn, without being totally distracted by their empty bellies. Administrators testified that many of those children relied on that program for their ONLY real meal of the day, but hey, who cares, right? As long as the gravy train stays open for the rich and elite, we don't need to educate poor kids. That's just one little example, among thousands, maybe millions. Your spin disgusts me, but that's nothing new.
I would like to hear more from congress in terms of actual legislation to deal with our energy crisis, instead of the idiotic "windfall profits" tax nonsense that does nothing to deal with this matter. How about raising the CAFE standard right now! Oh wait, I forgot, the democrats do not want to anger the state of Michigan in an election year; I mean not anymore than they already have with the primary mess. How about legislation to give substantial tax credits for the purchase of energy efficient automobiles and systems for the home. Why not drop the tariffs on importation of bio fuels from Brazil? Congress can do something, they just want to make sure they have issues for the election. Politics is a sleazy business, isn't it.
That is the classic liberal view."
And you spout the classic conservative one, badly, I might add.
"On paper there is no real supply problem because on paper we are looking at TODAY not tomorrow.."
Which is where we should be looking. Tomorrow, we can pay tomorrow's price, and get rid of these speculators, and we maybe can pay today's actual prices, and avoid the depression they are driving our country's economy toward. Duh!
"But investors speculate that the booms in the middle classes of India and China are growing beyond what Rory could comprehend......a term called growth."
I don't think Rory, or anybody else here is unable to comprehend anything, we just disagree that speculators should be able to run up the price now, artificially. This is Enron screwing Grandma, all over again.
"So they are buying up all available oil NOW because the demand today isn't going to be the demand in 2 years! Open your eyes!"
And yet, you want them to be able to charge tomorrow's prices today, and do it for the next two years, at which time they will be charging us two years down the road's prices, and pocketing the profits at the expense of our country's economy. Nice. Why do conservatives hate the very country that has allowed their cockroach like rise. The Speculation in oil, here, in this country has spurred the speculation worldwide, and since we are the largest market today, eliminating speculators here, for these external guys to sell to,will definitely affect them, as well. It's not rocket science.
For the last seven years, our government has been the captive of "free market fundamentalists" who have presided over the withering away of any government oversight of business and industry that protects the public good.
We are not at the end of food scares and drug recalls related to the planned failure of the FDA.
The Republicans, led by Dick Cheney, predicted in 2000 that businesses would be self-regulating and would behave in the public interest because this was good business.
It is unlike classic conservatism to assume that people will not take shortcuts to immediate profits over long-term survival.
Our real estate bubble is related to the systematic cutting back of ANY government oversight of loan practices at federally-insured banks.
It is the Republican mess with the Savings and Loan programs all over again. Of course, the Bush family and their cronies (and John McCain) made quite a bit of money in that fiasco.
The futures market NEVER reflects the facts on the ground today.
It is a bet, with a great deal of investors' money, about profits to be made from future markets.
Hence, the "futures" designation.
It can be manipulated by vast sums of money (like the Bass or the Hunt families trying to corner the market on silver back in the 80s - they lost a bundle).
Kay is right to suggest that the political will to take effective action has been sadly lacking in both political parties.
Because it is. Clean Coal isn't clean, it's just cleaner than high sulfur coal, and in comparison to other fossil fuels, still a dirty little secret. Clean Coal is a framing construct, and only relevant to the naive. Of course, those used to conservative think tank framing, such as "Death Tax" etc., probably think it's the gospel.
"Why do they hate nuclear energy?"
Until storage issues are answered, and since we have way more waste than we know what to safely do with, already, it is greed driving this market, without regard for tomorrow, a Republican trademark, by the way.
"Why do they hate the thought of drilling for the oil America has?"
You are talking, I assume, about ANWAR, and the arguments against that have been widely published. I suggest you read a few, and consider your future children, and their right to having some natural places reserved so that they know what the rest of their paved planet once looked like. The reserves there are speculation, as well.
"Why do they hate every alternative to energy but think taxes and congressional investigations will solve everything? Please tell me."
Come on, to the first part of that sentence, they don't, to the second part, because you conservatives have left a massive deficit, and so many messes that need to be fixed, obviously.
Ron is also correct on Coal, Nukes and ANWR. You do not enhance our country by destroying it. Clean coal is a myth. You must still go and get it, and doesn't leave anything pretty behind. Nuclear energy--oh sure, just a paint a big terrorist bulls-eye on parts of our country. Which is why the NIMBY factor would play big time. ANWR--surely this country can do better than scar a pristine wildlife refuge for our energy needs. We must remember, oil is a finite fuel source, let's be smart and develop more environmentally friendly energy alternatives.
You are the first one to point out that the Congress is being paid off by the financial industry (both political parties are guilty), and deliberately did nothing while the "mortgage bubble" developed. The blame for the falling value of the dollar (and thus the rising price of oil) clearly belongs to Congress, and the White House was a non-player in the debacle.
But, I have a question. Just how do speculators increase the price of a barrel of oil?
I thought that speculators (hedge funds and commodities traders) bet on whether the price of oil would go up or down in the future. If they were right, they made a profit, and if they were wrong they lost.
But, in the real world the price of oil is determined by either supply and demand in a fair market, or by those that can rig the market so that the law of supply and demand doesn't apply. The majority of the world oil supply is produced by government owned companies. So OPEC comes to mind, as do the Russians and all other oil producing nations, who can rig the price of oil without any regulatory body holding them accountable.
In your article, you state, "OPEC reported in March that the world was well supplied with oil, according to the AP, and it blamed speculators and mismanagement in the United States for the high prices." Well, I think they are right about the mismanagement which caused the falling value of the dollar. But I believe that blaming the speculators is a red herring to cover up price fixing by the oil producing nations.
Until we have an adequate domestic supply of energy, we can either go to war to grab some additional supply, or we can pay through the nose for imported energy. Since our Congress that is owned by environmental groups and foreign lobbyists, I'm betting the American people will have to pay until they learn how to use elections to change Congress and the White House.
The voters are the only ones who can make government work for the people instead of the special interests.
The burning of fossil fuels or any further use of nuclear power can only move us closer to the destruction of our world. Watching these little men scrambling around stabbing each other in the back, and fleecing consumers would be laughable if it weren't so sad. Kind of like watching ants scurrying around their colony, oblivious to the fact that a can of ant killer is being held mere inches above their heads.
Folks... we have a source of energy called the sun and it rains down enough energy on our planet in one day to meet our entire planets needs for decades. All that needs to be done is to believe in our ability to do what ever our imaginations can dream of.
I hope we have the wisdom to grow up and realize we are sitting on the precipous NOW, not tomorrow. We must act immediately to end the burning of fuels to generate energy. If we don't, we face absolute doom.
You are a rather humourous man.
If I may take a stab at this. By putting enough money behind the speculation. If for example, Goldman Sachs predicts oil will be $150 dollars a barrel by X date, my fund can put a price target of $125 and then some other fund pushes the price up higher, and the race is on. All you need is a catalyst, and then the price takes on a life of its own.
If you ever figure it out, let me know.
Kay is spot on.
The nation lost the will to continue making significant changes (Carter did succeed in getting the first meaningful increases in fuel efficiency standards) when Ronnie Reagan proclaimed "morning in America".
We cannot drill our way to a future of assured oil supplies.
When did Kay become so sensible?
On the flip side...we are being FORCED to investigate and obtain other energy sources, Masha'Allah, that will project us into a much more healthy way of living, not only towards saving $$ but for propagating a more healthy the earth and atmosphere.
The "Green Movement"...it's time is overdue and why? "They" can't figure out how to harness solar/water/wind power and make enormous profit from it.
Slowly, this issue is going to fall back to the hands of the people, if it is to be successful. That is their greatest fear.
The Sun, wind, and water could power us forever. Unfortunately, science talks and money walks.
It therefore suggests that nearly all of the subsequent increase is due to speculation.
No speculators should be allowed to bid up the price of oil (or the metals and foods) when they have no intention of taking delivery. Even if you cut Patrick's premium in half, it is clear that the wild bidding in the pits of the commodities exchanges in Chicago and New York is more akin to the pursuit of a pyramid scheme than to the execution of a sensible investment strategy.
Ron W. is on the right track...It's not too late for appropriate legislative action, properly phased in to avoid disruptions.
It's getting too late, I glimpsed over this article, but will have to read it another time. But, I highly recommend you watch this video by Lindsey Williams, a former Chaplin for Atlantic Richfield Oil Company, if you haven't already. It's rather long, but revealing. Very revealing.
http://video.google.ca/videoplay?docid=3340274697167011147&q=lindsey+william
First of all, a real great thing would be if the public would stop throwing around the "Democrats" and "Republicans" thing. Our government, in reality, is neither. They are controlling, not governing. They, behind the scenes, work together. Your vote counts nothing, absolutely nothing. Notice how they have to rehearse for public events. If it was all real, they would not have to rehearse. DUH!
Secondly now, watch the video that I posted above in the last post I made to this article. The man who made this video, explains it all thoroughly. It is a long video, but everyone genuinely concerned should watch this video.
Here it is again:
http://video.google.ca/videoplay?docid=3340274697167011147&q=lindsey+william
You and I have differing ideas on the drilling. I know full well that it is not a long term solution, but it would help carry us through until alternative sources of energy are developed and marketed. I say drill wherever we can to get us by.
Remember, oil will still be needed if we run every vehicle in the nation on electricity or hydrogen. Tires are made from oil as is most of the items used in hospitals and many other places. Our plastics are all oil dependent. So any sources of oil we develop will not go to waste!
You are very correct that congressional oversight is missing because the taxpayers are not doing their job! they can get away with doing whatever they want and to hell with the taxpayers. The party matters not as both do this.
I've stated many times that I hold it against every president since Carter that none has taken the vulnerability we have in the Mideast oil supply seriously enough to try to ameliorate the problem. It sure didn't take a rocket scientist to see, after the oil embargo, that we were subject to the whims of some rather unreliable people and yet, no administration was capable of making the connection! A Manhattan project or moon shot effort would have been appropriate and had that been done we probably wouldn't be in Iraq today.
When oil last spiked, people responded, SUV sales suffered, and then oil came down, and predictably SUV sales went up and our wasteful ways continued. With a gallon of gas holding steady at $4.00, now is the time to convert the "shock" of oil prices into action. As I said in my other comment, if we can successfully develop an alternative fuel to dramatically decrease our dependence on terrorist oil, we put them out of business and help the environment, it is worth the short term pain.
In the interim, let's drop the tariff on imports of bio-fuels from Brazil which will encourage more flex-fuel vehicles, and up the CAFE standards. Congress needs to act!
Energy Dept stats say that our oil consumption is about 20 million barrels/day. That means we have about 2 weeks' worth in storage. I don't have figures, but I believe that inventory to be at least half of total storage capacity, meaning at most we can store a month's supply. (Production could not suddenly and totally stop, so that inventory would last longer, say 2 or 3 months.
If inventories are approaching maximum, common sense dictates that some of the speculators, with those who actually hold those 300+ million barrels of oil, will start to sell in order to avoid getting stuck with it. That means that the bubble's life expectancy is measured in weeks not months.
Prices for oil will soon drop dramatically, possibly by mid-summer. Gasoline prices will lag, but will also begin to drop.
Not true. Much of the blame for the $$'s decline is due to historically low interest rates, pushed down in an attempt to counter the Bush tax cuts while simlutaneously waging a hugely expensive war. The White House is very much a palyer in this debacle.
We are in total agreement with the exception of the drilling. The rest of what you just wrote is exactly how I feel about it.
You state that it is "worth the short term pain" and I don't believe that you fully understand what that pain is to many people. The person who is working for under $10.00 (and there are many) and needs to get to work probably won't have the option of moving within walking distance. He or she will take food off the table, postpone or forgo medical care, buy all their clothes at the second hand store and hope something fits and isn't too traumatic for their children to wear and will suffer the pain of which you speak far more than some who simply has to reduce their driving to accommodate doubled fuel prices.
Drilling while recognizing the finite nature of the resource might help alleviate some of this pain and is a reasonable path to take in my opinion. I know it is anathema to rabid environmentalists but you haven't been one of them. I believe that it can be done safely and that the refineries will be built to handle it. They need to be built whether we pump it at home or buy from the oil sheiks.
I can't help but feel that petroleum will remain the mainstay of our transportation system for quite a few years into the future. And, like I said, there is a need for oil beyond transportation and lubricants.
I would acknowledge that it is entirely possible that part of the motivation behind the current price increases may be that the oil companies want to put pressure on to get the ANWR and offshore opened up to drilling and I hate to give them that satisfaction. However, I see the number of people who will be the recipients of that pain of which you speak and believe that it is the expedient and proper thing to do.
I guess this is one of those agree to disagree things! I do appreciate your intelligent and measured comments!
Truthfully, we don't have either a free market or capitalism in pure form. The government controls on most things preclude such and is largely there to protect the companies who are already engaged in the field. A classic example is the drug industry. If you want a drug, you must first go to a government licensed physician for a prescription, then take that to a pharmacy which has been licensed and then, if your insurance company approves, a government licensed pharmacist will fill the prescription. Tell me where the "free" is in that market. By the way, you may not get those drigs from Canada for a lower cost as that is illegal, even though many of the drugs are actually manufactured overseas. And even though Canada has tighter control on drugs than the United States. This helps preserve the virtual monopolies of the drug lords in this country.
Capitalism is a good thing but like all good things, it is better in moderation! And it must be tempered with good regulation or it will enslave a large portion of the population just as it did the serfs in ancient England. Capitalism is best served with a generous helping of socialism to temper it's harsh flavor, thereby allowing us to call our nation civilized.
Sugar being a commodity every bit as important to this American way of life as Oil when you get right down to it from the personal aspect (arguable I am sure).
But the "pattern" did not show up until the '70s when we had the "gasoline crisis" and price jumps accordingly ...
So, YES, I have seen the patterns and they have become just an artificial market strategy now in all areas where they can be "capitalized" upon ... whatever the market will bear ... business as usual ... the rich get richer and the poor get nothing but trouble.
By the way, the "secret oil" in Alaska is NOT that in ANWR ... it is where they have already drilled and capped ... they probably just want to secure ANWR ahead of the word getting out as to the vast volumes and profits to be made ... especially when they get the price inflated to the magic number they desire ...
Figures don't lie, but liars figure ... business and politics as usual .... trust your media ... ha ha.
However, the Congress and the White House are clearly reluctant to impose meaningful controls on Wall Street because of the political contributions that flow from the financial corporations.
You have to learn to think for your self, instead of parroting the "Bush lied, people died talking points." Our country's financial and energy problems are serious, our government is corrupt and ineffective (both parties), and an informed electorate is the only way we will make meaningful changes.
I don't buy anything the politicians have to say in their political campaigns because of their record of lying and corruption. No thinking American should either.
"We've been stepped on, lied to, cheated on, and treated like dirt."
With no end in sight.
"Why do they hate the thought of drilling for the oil America has?"
Well, why don't oil companies drill on land they already hold leases on?
It is reported that oil companies are only drilling on one quarter of the leases they currently hold, so why would they need more leases when they're not even using all that has been made available to them?
This is about stuffing pockets, not the good of the American people.
I'm totally with Devin's point, Solar and Water energy are woefully untapped; I'm not in favor of wind power. Also, broader mass public transit would be a key solution. Solar powered trains are totally possible.
Dave, you are an excellent writer and often bring some surprising stuff out to bear but your prejudices against the system that has given more to this world than any other in history is disturbing. What is remarkable (or should be to you) is that it works so well. There is no starvation in nations with market systems, life expectancy is higher, and the general way of life is eons ahead of the rest of the non market based world. Even tho much of what is passed off as the market system is not a true representation of it, the system still works. That invisible hand of the market (rational self interest) will beat out anything else tried. Look at where things are invented, largely produced, look at where intellectual freedom and property rights actually still mean something...all that comes out of the market.
The more it is tampered with ie government regulation/planning/manipulation of the tax system, the less likely it is to overcome what should be bumps in the road. Those bumps become major holes, the Depression, the real estate bubble in Japan, the tech bubble, the housing/credit bubble etc...these came about BECAUSE of government fiddling. This energy bubble is the same thing. The enviros get Congress to go for ethanol (food prices go up as do the energy costs for the whole farce), don't drill here or here, or here...the NIMBYs saying no windmills, nuke plants, refineries, soalr plants near them....As one other commentator pointed out, we can use less and it won't matter...India/China are industrializing. They need that energy and are buying up the rights to it while the US/West plays with minor alternate sources. China and India can't stop, their people want a better life and China at least knows what happens if they stop bringing home the proverbal bacon...revolution.
More government diddling from the next Congress/President is going to happen regardless of who gets elected. I hope we can survive that until people wake up and realize what they had voted in....
Don't blame government fiddling for the dot com bubble and failure nor the housing failure. The housing problems was probably abetted by insufficient government regulation and supervision. These were both the result of the "market economy" not the opposite.
You are correct, we shouldn't be dabbling in "minor alternate sources" but should be investing heavily in major alternative sources. These would include nuclear, wind, solar, and hydrogen as well as more hydroelectric which is not going to happen.\
You're also right that ethanol is not the answer. But there needs to be work don on other alternative sources in a big way. Bottom line is, we need oil, even if it is not used to propel our vehicles! Too many things require oil in some form including all the plastics, tires, etc. that we use. We will exhaust the supply of fossil oil some day in the not too distant future and should be preparing for that day in a big way. Also, we need to free ourselves of dependence on Mideast oil. It would be wonderful to be able to tell the oil sheiks to go take a hike, wouldn't it?
Government is not the answer to all things nor is it the bedevilment of all things. It's role is essential and broad. That it has been misused is without question, but that does not mean it is always bad or unnecessary. We can't nor do we want to eliminate all government controls and regulations.
For instance, our constitution calls for the government to award patents. Great! But this tacitly gives the government a responsibility to insure that those to whom patents have been grated do not use those patents to the detriment of the American people. Balancing the correct amount of regulation is a very difficult task and one which is bound to be laden with error. But that does not mean it should be done!
Well, I consider myself a liberal so let me take a stab at this request.
1. I hate nuclear energy because of the dangers of leaking radiation (umm remember Chernobyl...well I do), disposing of the waste (where will it all go?). Now consider 9-11, wouldn't a nuclear power plant present just another target for terrorists?
2. Why drill for oil and ruin what little unspoiled land we have left? Seems to me a better alternative would to make our cars more feul efficient. And what's wrong with wind, water and solar power? It doesn't run out!
And as for hating taxes...well, doesn't everyone?
I think if we could get away from the left/right polarization and really discuss viable alternatives and then pass the results on, we and our country would stand a good chance of climbing out of this dip in the road (well more like a pothole!) and taking back our country from the greedy hands of 'big business'.
Solar, water and wind energy are all renewable resources and as a rule much cleaner than combustibles like oil, gas, or coal and fissibles like uranium or plutonium (which ever is the current favorite of the Nuclear energy crowd). My only concern is that the supply of water for hydro electric energy may also become more finite as the climate changes.
However we do it, we need to make a concerted effort to unite towards a common goal that doesn't involve the useless slaughter of innocents!