A campaign promise kept: he wants higher gasoline prices and his policies guarantee they will only go higher.
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But the Obama Administration has not just squelched offshore drilling. Drilling opportunities have been withdrawn in Montana, and oil shale production activities have been stopped in Colorado and elsewhere in the American West.
In December, the U.S. Fish and Wildlife Service began the process of listing the dunes sagebrush lizard as an endangered species. As Investors Business Daily explained on April 28:
If the dunes sagebrush lizard, now considered a separate species, is granted endangered status, oil and gas production in the Permian Basin in New Mexico and Texas may have to be shut down…. The Department of Energy says the Permian Basin has a quarter of the nation’s proven reserves and 20% of the nation’s daily production comes from there. It has a quarter of the nation’s active oil and gas wells and is home to 21% of the rigs actively drilling in the U.S.
Supply down, prices up. That should not be too hard to understand even for a grassroots Democrat. But highly skilled Obama propagandists say, hold on, domestic oil production for 2009 and 2010 is up, not down. President Obama cited the figures himself, saying, “So any notion that my administration has shut down oil production might make for a good political sound bite, but it doesn’t match up with reality.”
But the reality is that just as the economy grows over time, oil production is supposed to grow with it. All of the above actions the Obama Administration has taken to shut down oil production means unambiguously that oil production is now or soon will be lower than it would have been otherwise. Which means prices are higher than they would have been otherwise.
Moreover, oil is not produced by flipping a switch. It takes years of development. Which means the increasing oil production in 2009 and 2010 that Obama and his propagandists cite is due to the policies of the Bush Administration. The impact of the policies adopted by the Obama Administration over the last two years, as part of its War on Oil, will be seen in oil production figures in the years ahead. Already the Energy Department projects that oil production in the Gulf will be down 20% just this year. That translates into a loss of 375,000 much needed, good paying jobs. The Department further projects that domestic oil production overall will drop sharply over the next two years.
In addition, oil markets today are not blind to what is coming down the pike. Today’s oil price reflects the outlook for tomorrow. And constrained supplies tomorrow mean higher prices today. Opening up new oil supplies for tomorrow will similarly mean lower prices today.
Beyond oil supply and demand, there is another powerful factor driving up oil and gasoline prices. The price of oil tracks closely with the price of gold going back many decades. Look it up for yourself. The same wildly loose, Keynesian, Federal Reserve monetary policies (fully backed by President Obama) that have been causing gold to soar are causing oil to soar as well, along with other commodities across the board. Hence the rise of inflation, which is causing real wages to decline in this brave, new world of Obamanomics.
Obama’s Scapegoating: Another Abuse of the Public
In addition to the above abusively misleading propaganda, President Obama is already scurrying to deflect blame for the gas price suffering resulting from his deliberate policies to others — the scapegoats.
He has ordered the Justice Department to investigate the possible illegal actions of speculators. In his April 23 radio address, Obama bragged that as a result the Attorney General has “launched a task force with just one job: rooting out cases of fraud or manipulation in the oil markets that might affect gas prices, including any illegal activity by traders and speculators. We’re going to make sure no one is taking advantage of the American people for their own short term gain.”
But unless the Justice Department is going to investigate President Obama and his policies, that last sentence cannot possibly be true. When Attorney General Eric Holder said his task force had already uncovered a couple of things that are disturbing, the Wall Street Journal editorialized in response, “That must be some crack squad.”
That response was apt because all the sermonizing about speculators is a long standing, disreputable abuse of the public raised by political scoundrels every time oil prices rise. Oil prices are set in a world oil market. Speculators speculate that oil prices will fall as well as that they will rise. If they speculate the wrong way, they lose their shirts. That is why an exhaustive investigation in 2008 by the Commodities Futures Trading Commission, which unlike Obama’s politicized Justice Department actually enjoys expertise on the issue, concluded that the net effect of speculation was to reduce prices. That is because all the speculation just nets out to accelerating market recognition of supply and demand conditions, making oil prices smoother and less volatile, reducing risk and hence price.
That is why as Investors Business Daily editorialized on April 26, “At last count, 35 such investigations have been conducted over the decades, and none — not a single one — has turned up wrongdoing by investors or oilmen.” All of this talk of speculation is just boob bait for bubbas, intentionally misleading the gullible, uneducated, and easy to command. As IBD added, “Rather than carry out another useless inquisition of private citizens, our political class should be investigating its own role in the price crisis. The result would be a revelation for those who fall for Washington’s line about greedy businessmen whenever gasoline prices become painfully high.”
But President Obama does have a policy answer to the question, what is your plan to address rising gas prices? He wants to raise taxes on oil companies. With all of the profits oil companies are making, Obama says, they don’t need any subsidies. He labels $4 billion in tax loopholes as oil company subsidies and calls for those loopholes to be closed.
A man of faith in a godless age is hitting Americans where it hurts.
Mr. and Mrs. American Spectator Reader, let P.J. O’Rourke talk sense to your kids.
In Britain, defending your property can get you life.
The debacle of this president’s administration is both a cause and a symptom of the decline of American values. Unless Congress impeaches him, that decline will go on unchecked. An eminent jurist surveys the damage and assesses the chances for the recovery of our culture.
It won’t take long for conservatives to scratch this presidential wannabe off their 2008 scorecard.
The American Christmas, like the songs that celebrate it, makes room for everybody under the rainbow. Is that why so many people seem to be hostile to it?
Was the President done in by the economy, or by the politics of the economy?