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Special Report
The New Ugly Americans
Naturally, Chuck Schumer is one of them, sabotaging America’s energy security and world standing.
One of the saddest and most tragic spectacles in history is to witness a nation trying to exercise its power long after the economic origins of that power have gone into decline. Think of Austria languishing as the rest of Europe industrialized or France trying to defend itself against Germany in 1940 or even Russia trying to play the Cold War combatant as Communism rotted it from within.
Today we are undergoing a similar dance in our economic relation with China. And wouldn’t you know, it’s our liberal friends in Congress, so enthusiastic about hamstringing American enterprise, who are the last to realize that they are undercutting our political hegemony as well.
I am speaking, of course, of Senator Charles Schumer of New York and Representative Edward Markey of Massachusetts, both of whom have decided we are in a position to tell a Chinese company that it cannot acquire a Canadian company because… well, because we’re Americans and the world has to pay attention to what we say.
Here’s the setup. Last week the Chinese National Offshore Oil Company (CNOOC) offered $15 billion to buy Nexen, a Canadian drilling company with large holdings in the Athabasca Tar Sands of Alberta, which is rapidly becoming Canada’s pot of gold in energy development. Now it so happens that only six months ago the Canadians were planning to ship nearly all of this newly developed oil to Texas via the Keystone Pipeline. Environmentalists, however, swore the pipeline would be built over their dead bodies and President Obama, not wanting to be left with no natural constituencies except single mothers and minorities, decided to appease environmentalists and block the pipeline.
The Canadians were shocked. They had long planned to sell this oil south of the border. Canada is already our largest supplier of foreign oil and it was inconceivable that we wouldn’t want to take more it instead of relying on Iraq, Nigeria, Venezuela, and other unpredictable sources. All this brought the sudden realization that Canada is dependent on us for 97 percent of their oil exports. Prime Minister Steven Harper quickly decided it was time to diversify. He took a well-publicized trip to China and the Nexen purchase was one of the first results.
Like any other voluntary exchange, the deal will bring benefits to both sides. Canada is actually running short of capital in developing its tar sands resources and China’s investment will help. At the same time, China wants access to both oil resources — something they are pursuing around the world — and Western knowledge and technology. Nexen has some very sophisticated expertise in offshore drilling
In passing, it might be worth noting that the Canadians are becoming very prosperous at this. They are developing resources in a way that we aren’t. They’ve also gotten control of their government. They recently passed the U.S. in average income and are starting to purchase US resources. A recent analysis of the Phoenix housing market found it was beginning to come back because of an influx of Canadians buying second homes.
So who could possibly be opposed to all this? Well, liberal Democrats, of course. They can’t stand the idea of anybody getting rich without being able to tax them. Nor can they countenance the idea of people just going out and doing things without asking permission. Remember, “You didn’t build that. Somebody else did,” and so when two entities, even foreign corporations, do things without permission the government has to intervene.
And so our friend Chuck Schumer fired off a letter asking Treasury Secretary Timothy Geithner to block the deal until the Chinese government takes “concrete, enforceable steps to open that country’s markets to foreign investment and level the playing field in international trade.”
It is rare that we have so much leverage to exert upon China. We should not let this window of opportunity pass us by. At some point, we have to put our foot down over China’s refusal to play by the rules of free trade.
Markey followed with a letter demanding that Geithner insist that CNOOC pay royalties on tracts that Nexen recently won in the Gulf of Mexico where the government offered them royalty-free. “I believe this merger could lead to a massive transfer of wealth from the American people to the Chinese government, and I strongly urge you to block this proposed transaction until, at a minimum, parties to the merger agree to pay royalties to the U.S. taxpayer on all oil produced off American shores or relinquish any ownership interests in these leases,” Markey fulminated.
As Christopher Helman points out in Forbes, these assets in the Gulf of Mexico that supposedly offer such a “rare” opportunity for “leverage” consist of 200 leases worth $1.5 billion, less than 10 percent of Nexen’s net worth. Most of them have not been explored yet. The reason they were let out royalty-free is that they are very difficult and unpromising areas that few companies were eager to risk. If the government had asked the usual 18 percent, no one might have bid at all. It will cost hundreds of millions to explore and hundreds of millions more to develop if oil is discovered. If the U.S. seriously tries to exercise this “leverage,” CNOOC-Nexen will probably just sell them off.
As for the “massive transfer of wealth,” just compare the $1.5 billion in lease assets to the $1.1 billion per day the U.S. now spends on foreign oil. As Helman points out, if CNOOC does find oil in these tracts, it will probably be sold to Texas refineries. (Oil tankers can’t make it through the Panama Canal.) So the result would be more oil from domestic resources and less dependence on Saudi Arabia, Nigeria and Venezuela, even if the Chinese do take their cut.
There’s one other relevant detail here. In 2005, CNOOC made a perfectly legitimate bid of the same $18 billion for Unocal, the California oil company that had sold its U.S. assets and shifted most of its operations to Central Asia. (It was once used by the CIA to spy on the Taliban.) The House of Representatives immediately objected to that deal, saying it “threatened national security.” Pressure was put on President Bush and CNOOC eventually withdrew the offer. So how is that going to look when Senator Schumer and Congressman Markey start talking about “opening China’s markets to foreign investment and level the playing field in international trade?”
The world does not dance to America’s tune. We won our hegemony through economic might and military muscle. All that is now atrophying. We have dug ourselves a huge hole by placing all kinds of oil and gas reserves off limits, refusing to develop our own resources, refusing to accept foreign resources through the Keystone Pipeline, downgrading all business activity and scapegoating those who succeed at it. The Chinese now hold $1.2 trillion in U.S. Treasuries. Is it surprising that they might want to exchange some of it for concrete assets?
Political power has always drawn its strength from economic success. Is it so surprising then to find that people such Senator Schumer and Congressman Markey, who are so quick to dismiss the accomplishments of America’s merchant power, should be the last to realize that their political power is eroding as well?
Letter to the Editor View all comments (56) | Leave a comment
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Bill Hussein O'Stalin| 8.3.12 @ 6:24AM
The Democrats are an out in the open terrorist organization operating within our borders, doing anything they can to bring the country to a position of submission at the Democrat's knees, in a position of genuflection.
TLP| 8.3.12 @ 10:39AM
If you were Jack in Wi, and you wanted to persuade everybody else, that the Jews were the Worst Human Beings on the planet, and Deserved of a Quick Death?
Could you, in a Million Years, or in your Wildest Dreams, come up with a more Perfect Poster Boy for your Argument, than this Lying, Thieving, Shylock Looking, Puke of a Human Being, who's every Word and Facial Expression is reason enough, to take his head off?
The answer is NO.
You could not.
Bob K| 8.3.12 @ 7:17PM
As hard as it is to believe, maybe these Democrats are on to something?
This current article from Reuters dated August 4th, says that China wants and needs this Canadian oil so they can concentrate on developing their expertise in drilling for oil in the deep, disputed waters of the South China Sea which is also claimed by Vietnam, Taiwan, the Philippines, Brunei and Malaysia.
http://in.reuters.com/article/.....0M20120803
This looks like a real big Foreign Policy issue involving matters the Diplomats would rather not share with the public.
Bob K| 8.5.12 @ 11:08PM
If the Chinese enlarge their presence in the South China Sea and increase their deepwater drilling for oil there we can expect that the Chinese Navy will also increase it's presence.
What result will this have on America's Foreign Policy there with all the countries which also have claims to the Oil in that sea?
Small deals like this one discussed here between Canada and China can have large consequences in the future.
MelvinNC| 8.3.12 @ 7:01AM
I have come but to one conclusion recently, well actually two. We must begin a war on two fronts. The first being, these small petty, yet well funded groups who with their radical and Marxist ideology have great sway and influence within the Democrat Party and even Progressive Republicans.
The next thing, which is easier said than done is to get rid of the likes of Chuck Schumer and Sir Edward. No one and I mean no one should have that much political power in our type of government.
The Democrat Party through their deep pocketed militant environmentalists groups created the conditions for China to come in and fill the vacuum that was left after the boy idiot said he would veto the Keystone Bill.
But then again maybe Obama wasn't so much of an idiot. Because he knows that lack of energy is this Country's Achilles heel.
In short, I guess what I am trying to say is that there comes a time where elections just are not enough.
R Martin| 8.3.12 @ 8:08AM
Given their constituencies, I suspect Schumer and Markey will be re elected as long as they choose to run and, along with like minded colleagues, they will continue to undermine the country with the sort of leftist ideology and government policy Mr. Tucker warns against.
jaytrain| 8.3.12 @ 8:15AM
Perhaps as their 401k's turn to kitty litter and their college grad offspring take over the couch , their constituents might see the error of their ways . That will take along , long time . Too long .
Houdini| 8.3.12 @ 11:17AM
Why give these people legitimacy by calling them what they want to be called i.e, democrat, progressive etc. Its time to call them what they really are, STALINISTS. These folks would be right at home in N. Korea and the Soviet Union of the 30's. The MSM would make Stalin's Pravda proud and has allowed these Stalinists to come out of the closet by calling them "liberal". They're not liberal, they are a determined enemy of this country. If we don't stop them this November we're toast.
Alej| 8.3.12 @ 1:55PM
"In short, I guess what I am trying to say is that there comes a time where elections just are not enough."
Happened in 1861, and getting close to that point now.
Quartermaster| 8.3.12 @ 3:05PM
One thing you need to remember about 1861-1865 is that it was not a "Civil War." The south could not have cared less about ruling the north, it just wanted to be left alone as Washington and the other founders wanted. The north engaged in a war of imperial conquest. If we had a real civil war, then the country would be destroyed.
Frankly, I'm betting the country does break up. The stupidity of both parties put us in the boat we are in and I think the tipping point is already past. No one is going to pull things out in time to keep the country from crashing. I, for one, would not mind seeing the CSA rise again.
Alan| 8.4.12 @ 7:31AM
I'll second that, this will never be repaired in the present context.
RCV| 8.5.12 @ 10:00PM
Listen up, you little Confedrate traitors. The American people won't put up for one moment with anyone who tries to break away one inch of this UNITED country. Too many of our ancestors gave their lives to preserve this Union, you traitorous scum. Try it, and the results will be the same, only a lot quicker this time with modern armaments.
Skippy| 8.6.12 @ 3:03PM
Yawn....
Lil' RCV seems to forget which side hates guns and which side practices with them.
RCV| 8.6.12 @ 3:16PM
The United States government has plenty of weaponry, Skippy, and it's in very good working order. You jokers would last about 15 minutes.
Von Mises Jr| 8.3.12 @ 7:46AM
The Progressives (read fascist) intend to drill if and when the state owns the energy industry as China owns CNOOC. CNOOC Limited is a subsidiary of China National Offshore Oil Corporation.
The elites (read socialist) believe it is the states oil, not the people's resource.
Cobalt| 8.3.12 @ 8:17AM
The elites not only believe they own oil, land and other resourses, they also believe they own us.
Louis Jenkins| 8.3.12 @ 8:28AM
How long before the lazy (yes lazy) public will see that the likes of Schumer and Markey do not have our interest at heart. How long Oh Lord?
Alej| 8.3.12 @ 1:56PM
Never. That is why they are called "Yankees."
Truncheon| 8.3.12 @ 8:42AM
New Yorkers, though in large part a decent folk when you get to know them, are not noted for discernment in the political arena.
I imagine Chuck Schumer will handily win re-election among that "public" for as long as he desires and is able.
Crassus| 8.3.12 @ 8:52AM
When Chuck Schumer was born the doctor slapped his mother and spit on his father. It's been downhill ever since.
MK48| 8.3.12 @ 10:17AM
Untill we drain the swamp.......these crock's will continue to control us.
We as americans have to stand-up and vote these vermin out of office........GOP & DEM.
For all of you nasayers here on TAS you are the problem with this country. You are the "tick" of society....do nothing but hang on and suck the life out of everything and everyone.
You know who you are and so do WE.
Anthony| 8.3.12 @ 11:13AM
Several years ago it was reported that while hiking, Schumer found a tick on him. The tick died.
The poor tick was outmatched by the king of the blood-suckers.
CJW| 8.3.12 @ 7:23PM
Anthony
A contest between parasites.
JamesDrouin| 8.3.12 @ 8:56AM
Unfortunately, there is nothing "new" about the uglyness of liberalism ... it has an unparalelled legacy of an appearance that literally stops clocks.
To paraphrase Casius Clay:
'It is so ugly, it has to sneak up on a glass to get a drink of water.'
Anthony| 8.3.12 @ 9:03AM
Schumer and Reid are two of the most vile and dispicable human beings ever to hold high office in this great land. And that is quite an accomplishment given how many reprehensible pols have come and gone.
These mean spirited nasty bastards are so drunk with power they have become completely unhinged from reality.
It is not a streach to say the D Party is out to destroy America, given the litney of destructive policies they impliment.
Melvin is right. This nation was forged by physical resistance against despots and those who sought our subjugation.
No time like the present to get back to our roots. Nov. 2012 will be just the beginning.
nathan| 8.3.12 @ 9:57AM
Many years ago Schumer told a group in his office that is was better for a woman to be raped than to defend herself with a gun. A woman in the group told him, "I have been raped and I totally disagree with you". That momentarily shut him up.
CJW| 8.3.12 @ 10:19AM
Key word is "momentarily."
He is disgusting.
Emilee S.| 8.3.12 @ 10:07AM
That scarf!
It's obviously Hermes, and I estimate its cost somewhere between $700 and $1000.
Mr Tucker, you are American Spectator's resident fashinista, and I commend you on having the courage to drape one of the world's most expensive scarves around your neck. So lovely.
And the careful arrangement--the way it frames your face. Your eye for fashion is fabulous. And I imagine you, too, are fabulous.
And to continue my Variation on a Theme of Fabulous, I wish all of you at AmSpec a fabulous day.
Pooch Perfect| 8.3.12 @ 10:10AM
I'm with you, Emilee, the scarf is fabulous. And its artful arrangement shows that Mr. Tucker is a man of refined taste.
Trish| 8.3.12 @ 10:13AM
And I particularly want to wish that lovable, huggable Ben Stein a fabulous day!
Ben, may you have a cheeseburger for lunch that is to DIE for!
fmm| 8.3.12 @ 3:06PM
Love the sarcasm on this train.
Trish| 8.3.12 @ 6:42PM
And Emilee, I do not believe that scarf is a Hermes.
Mr. Tucker looks like the kind of man I see ambling down the aisles of craft shops looking for fabrics.
I suspect Mr. Tucker not only designed that gorgeous scarf, but made it himself.
No doubt about it; it's a beauty.
And I, too, commend you, Mr. Tucker for having the courage not only to wear it, but to pose in it for a picture that appears in the prestigious and intellectually rigorous American Spectator.
Vance P. Frickey| 8.3.12 @ 7:12PM
...and we never got to find out if environmentalists' dead bodies made a good foundation for pipelines.
Shame.
Libertyinfinite| 8.3.12 @ 12:10PM
The government that the American people created is despotic in every way imaginable today. It's ugly, it's painful, it's bondage, slavery, servitude, & it is what the American People made for themselves to sleep in.
Libertyinfinite| 8.3.12 @ 12:13PM
It doesn't do any good to create scapegoats in the government that the American People erected over themselves. Ultimately, it is the American People who must learn to self govern again, who created these nastys who must change. If not, the bad guys will never go away.
Mars the Avenger| 8.3.12 @ 1:06PM
We are, as Edward Gibbon said of the 5th Century Romans who thought they were still on top of things as Franks, Goths and Huns were ravaging the Western Empire, living "sub magni umbra nominis", under the shadow of a great name. We are living off the capital (economic and military) put in place by previous generations, only for us (as a society) to piss it away. It amazes me that Shumer and Markey are clueless enough to piss off our banker - China. Until we throw out the whole shebang in Washington DC, Democrats, RINOs - in sum anyone responsible for our current state, we cannot get rid of senseless regulation and spending to rebuild our economy, thereby laying the foundation for strengthening our military. We are following all previous powers / empires to the dustbin of history.
(I have tongue in cheek asked my English sister to petition the queen to send another British army to burn Washington down again on this 200th anniversary of the War of 1812, to clean out that rats' nest once and for all.)
PolishKnight| 8.3.12 @ 1:24PM
As I've personally learned the hard way, it's harder to exert leverage on people who owe you money than the other way around.
Consider: Let's say China decided to send a few missiles on over to Taiwan. What's the first thing the USA would do? Immediately cancel our national debt! When the USA went to war with Germany in WWI, the first thing they did was to send over the feds to take over Bayer aspirin. When the real estate bubble popped, smart owners who were underwater made another HELOC as fast as they could and walked, leaving banks to hold the bag (I know of one case where this happened. The guy was underwater by $50K and got ANOTHER HELOC on the property before walking!!!)
Mars the Avenger| 8.3.12 @ 1:50PM
PolishKnight,
That is all too true.... I know, I worked in international banking for 23 years and had to work with such sterling borrowers as the Argentines. Doesn't do much to endear us to other creditors, but it is a source of leverage and a weapon.
BTW, I read and like your posts..
Cheers.
Petronius| 8.3.12 @ 1:08PM
Shumer has ruined us. Now he thinks he can shake down the Chicoms. He's lucky they find him useful for other things or their agents here would clothe him in concrete and dump him into a vat of soy sauce. This despotic worm is the Lansky of the federal government demanding his cut the action just to show the world who's the real boss.
theyjustcantstop| 8.3.12 @ 3:11PM
i smell a rat,romney's ad is getting to them,o'bama will come out in favor of the pipe-line,of course starting in 2013 after another epa study.
for them to say china's not playing buy the rules of free trade,and have a monetary policy of this administration,takes a set.
just a month ago these same politicians let china set up a bank in nyc,to make it easier for them to purchase treasuries at a more reasonable price.
politics has taken over way more of american life than is safe, that makes politicians very dangerous,as you can see.
sallycranston | 8.3.12 @ 3:24PM
I love how we subsidize solar companies via the Stimulus and then critisize China for not playing by the rules for doing the same.
You’re a solid writer and a good candidate to contribute columns at a new website I’m involved with promoting: www.WriterBeat.com
burr56| 8.3.12 @ 4:38PM
It's hard for me to believe that sane people who are their constituents, could possibly agree with their positions on this matter. Even most liberals understand what's at stake, or do they?
mrkeratin | 8.3.12 @ 10:51PM
I'm not sure most liberals to know what's at stake. Pretty sad where our country stands right now.
Don O'Brien| 8.4.12 @ 12:21AM
Most real native NewYorkers moved to Nassau, Suffolk, and other suburbs 50 years ago. And these are Republican areas. NYC is filled with immigrants, minorities and out-of-staters, solidly Democrat except for Queens and Staten Island.
RCV| 8.5.12 @ 10:08PM
Obama carried both Suffolk and Nassau counties.
Skippy| 8.6.12 @ 3:13PM
He didn't say they weren't still stupid, just that they had moved.
RCV| 8.6.12 @ 3:17PM
He said they were Republican areas.
Gueppebarre| 8.4.12 @ 6:55AM
Just wait little while, Canada - the new American president will have more flexibility after his election...
Gueppebarre| 8.4.12 @ 6:56AM
Tell Steven... and stand with us on this...
JamesDrouin| 8.5.12 @ 12:35PM
Liberalism has ALWAYS been "ugly".
And the ONLY people that can't see that are, and always has been, practicioners of "self-deception".
Aka "liberals".
Marie| 8.5.12 @ 1:04PM
The Democrats don't want the US to build the pipeline and don't want anyone else to get there grubby little paws on the energy source, either. Jealous boyfriends/girlfriends that murder former boyfriends/girlfriends have this same mindset. Disturbing.
Marie| 8.5.12 @ 1:05PM
Ooops, I meant their, not there.
John Locke| 8.6.12 @ 9:59AM
The problem with the keystone pipeline (aside from environmental issues) was that none of this oil was going to be ours anyway. It was going to get pumped down to Houston to go into the international market and bought by China. So we we were going to build this giant pipeline to make it easier for China to get out Canadian oil on the International market. Oil is a fungible commodity. There is no such thing as "our oil" unless we nationalize our natural resources, which of course would be opposed by anyone who opposes "socialism". You can't have it both ways. Either embrace socialism, or accept the fact that oil is a fungible commodity, and that it goes into a pool.
ChristyW| 8.6.12 @ 9:57PM
If arrogance smelled like body odor, Schumer and Markey would clear the room. First they sabotaged the Keystone deal for our country, so they could pander to the green cartel. Then, after they realized they'd completely stepped in it, they make demands on China? And we owe the Chinese how much?? Yeah, there’s some leverage for you. I’m so tired of having to suffer fools, who are so drunk on their own power, that they don’t care how much damage they’re doing to our country. At least we can solve the Ed Markey problem in November. There is a refreshing alternative to Ed “cap and tax” Markey, and his name is Jeff Semon (pronounced Simone). Whereas, Schumer and Markey have produced nothing, and created nothing except headaches for small business owners everywhere, Semon is a conservative who has private sector experience and knows firsthand the ruin that excessive regulation has caused. Ed Markey has been in DC for 36 YEARS, and unless we purge Washington of him and Schumer, and others of their ilk, prosperity in America will be a thing of the past! I support Jeff Semon.
http://www.jeffin2012.com/