Barack Obama’s muddled thinking, so typical of a radical environmentalist’s hatred for oil and other things that improve human life, leaves him with an energy policy that only a Democrat (but not one from an energy-producing state) could find satisfactory.
This is not some sort of theoretical debate with unknown policy impacts. It is not a fundamentally trivial make-believe issue such as the “war on women.”
Instead, there are few policy issues as critical as this to all Americans, especially to those of modest or fixed incomes: high oil prices function as a massive tax increase, and a tremendously regressive one at that.
Low-income Americans spend about 11 percent of their income on energy while the top 20 percent (by income) of households spend less than seven percent. Again, this is only direct energy spending. When you include the cost of other things people must buy, particularly food, whose costs rise with higher energy prices, the regressive nature of rising fuel prices becomes all the more dramatic.
Particularly in the northeast, oil prices directly correlate to the cost of heating one’s home in winter. (That part of the country tends to use more heating oil where other areas use more natural gas, propane, or electric heat.)
For 25 years now, analysts have noted the devastation that high energy prices cause to our nation’s least well-off residents: “On some days, many of America’s poorest households must choose whether to heat or to eat. This kind of choice is beyond the comprehension of most middle-class Americans.… But for the poor… it remains a daily part of their lives.”
According to a report in the Christian Science Monitor, “For every 10-cent increase in the price of a gallon of gasoline, it costs the economy about $11 billion.” Even the Obamaphile ABC News has noted that “A 10 cent rise in prices means that the average household spends $93.25 more on gas and diesel per year.”
So it’s not surprising that by one analyst’s calculations consumer confidence “falls half a percentage point for every 10-cent rise in gasoline.” Why shouldn’t it? And these are just dimes, whereas the price of gasoline is up by about $2 per gallon since Obama took office. Multiply the numbers above by twenty and consider the financial devastation to the country, especially to the non-rich. And then think about Barack Obama’s chilly indifference.
It makes perfect sense that the recent record-high gas prices for a Labor Day holiday corresponded to a decline in consumer confidence in August, leaving the leading consumer sentiment index at its lowest level since late last year. And yet Barack Obama remains ahead in political betting odds to win reelection (though I’m betting against him).
Is President Obama’s soaring but vapid convention rhetoric supposed to get Americans to forget the near-daily pain at the pump? Republicans must make sure it does not.
The section of Obama’s Thursday night nomination acceptance speech that discussed energy was a triumph of hope over reason and fact, but then why should energy be any different than his other policy positions or his supporters’ Through the Looking Glass view of reality?
Obama noted that the U.S. is less dependent on foreign oil than in the past. However, some facts were conveniently missing: First, the decline of our use of foreign oil began under President Bush in 2005. Second, and more important, the reason is primarily the recession and weak “recovery” which has sapped demand for fuel to transport goods and people.
Obama claimed that he has “opened millions of new acres for oil and gas exploration in the last three years” but didn’t mention that essentially most new drilling on federal land was approved under the prior administration. This administration has been relentlessly hostile, and the issuance of permits to drilling on federal lands has plummeted under Obama. It’s only on private land that drilling has increased.
One of the several political tin-ear remarks made by Obama on Thursday, unless he was only speaking to his radical base in which case he probably made sense in their miswired minds, was his list of the energy projects he supports, which includes wind turbines, long-lasting batteries, solar, clean coal, and biofuels.
Of course, we’ve heard it all before and know the results. (Can you say “Solyndra”?) It was hard to listen to the president and not wonder how life is on Planet Enviro, since he’s clearly not interested in, nor concerned with life on, Planet Earth.
Obama did mention natural gas; generous of him since it may become the most important long-run energy source for the nation, something none of the left’s favorite energy sources can ever hope to claim. And while some power plants are converting from coal to natural gas, and a few major firms are investing in natural gas infrastructure, for years to come we will be an oil-based economy.
Thus it would seem obvious that drilling for more oil under American soil is the most sensible way to decrease dependency on foreign oil sources, and especially oil coming from OPEC nations, some of which are enemies and none of which are friends of the United States. (Most people think of OPEC as comprised only of Middle Eastern nations, but it includes countries elsewhere in the world, including Venezuela.)
Obama’s refusal to permit the Keystone XL pipeline (getting Canadian oil being second-best to using our own, albeit a distant second) was the clearest example of his disdain for the most energy-dense source of transportable power that we have. Some say it shows that he is completely beholden to radical environmentalist groups. I disagree. Yes, he likes and wants their support, but in his heart he is one of them.
Lest you disagree, if you think that Barack Obama opposes high energy prices (other than for political reasons), allow me to remind you of his famous statement that if he got his way with cap-and-trade and coal regulation, “electricity rates would necessarily skyrocket.” Just another piece of the same ugly puzzle.
The failure of The One is further evidenced by his backing away from his own foreign oil-reduction promise of four years ago, despite having the dubious tailwind of a weak economy helping him achieve his stated (but not his true) goal.
On Thursday night, Obama said he aims to “cut our oil imports in half by 2020.” Four years ago, during his 2008 acceptance speech, Obama said “in 10 years, we will finally end our dependence on oil from the Middle East.” Fool us once…
OK, let’s be fair: It’s not a big a failure as his promise to cut the deficit in half, but then it’s hard to top that one.
But as long as we’re being fair, it’s not fair to the word “failure” to use that term to describe Barack Obama’s energy policy. He is doing exactly what he wants to do.
As with, and included in, his goal of increasing dependency on government, the president’s actions reflect what he and his radical base believe: that the level of evilness of an energy source is proportional to that source’s economic viability and current usefulness.
(This fits into a similar pattern where the degree of liberal opposition to an industry is proportional to the degree to which people depend on that industry. Consider the biggest recipients of leftist rhetorical venom: oil, finance, pharmaceuticals, and WalMart. The more you need it, the more Obama and friends oppose it — though they still want their campaign contributions.)
Obama’s pseudo-failure on energy policy, especially given the obviousness of the solution, is unforgiveable.
The Green River Formation covers mostly vacant land — with oil-likely areas about 75 percent owned by the federal government — in eastern Utah and western Colorado and Wyoming. In 2010, the non-partisan Government Accountability Office offered a report on “Unconventional Oil and Gas Production,” which puts it plainly:
(O)il shale development presents the following opportunities for the United States:
• Increasing domestic oil production. Tapping the vast amounts of oil locked within U.S. oil shale formations could go a long way toward satisfying the nation’s future oil demands. Oil shale deposits in the Green River Formation are estimated to contain up to 3 trillion barrels of oil, half of which may be recoverable, which is about equal to the entire world’s proven oil reserves.
• Socioeconomic benefits. Development of oil shale resources could lead to the creation of jobs, increases in wealth, and increases in tax and royalty payments to federal and state governments for oil produced on their lands. The extent of these benefits, however, is unknown at this time because the ultimate size of the industry is uncertain.
Jack Gerard, President and CEO of the American Petroleum Institute, reminds us that “America has been described as the next Middle East in what it has in the form of oil and natural gas. With pro-development policies, we could create millions of new jobs and provide billions of dollars of revenue to our government.”
The GAO fairly notes that very large-scale oil resource development is not without issues such as water usage, potential pollution, and influx of large numbers of workers into areas not yet equipped to handle it.
But given these risks versus the potential of dramatically cutting the price of just about everything people buy in America, what do you think citizens would choose to do?
Actually, at least according to one API-sponsored poll, we know what they would choose: Seventy-one percent of respondents support “increased access to domestic oil and natural gas resources” with those who “strongly support” such access numbering twice as many as those who “somewhat support” it. “Somewhat support” alone swamps those who somewhat or strongly oppose drilling for domestic energy. Support crosses party lines, with 85 percent of Republicans, 72 percent of Independents, and 60 percent of Democrats offering some sort of support. Even among Democrats, “strongly support” exceeded “somewhat support.”
It’s not just about getting the price of gasoline, diesel, and fuel oil down — along with the price of everything which is transported in a car, truck, or train. It’s also about the nation’s massive budget issues.
While we have a spending problem rather than a tax revenue problem, the revenue from developing the Green River Formation could have a dramatic beneficial impact on the federal budget. According to one analysis, “if only 30 percent of [potential] royalty revenues flowed into the U.S. Treasury, that would be enough to pay off the entire national debt without raising tax rates or cutting federal spending. Moreover, state taxes on oil and gas produced would enable state governments to keep tax rates low without affecting government operations. “
It’s not just the Green River deposits that we should be exploiting to the benefit of all Americans. There is oil and gas across the western United States, such as in Montana, where, as the Spectator‘s Bradley Anderson has noted, energy development is far behind that of neighboring North Dakota. In that state, an energy boom has the state’s unemployment rate at the nation’s lowest because a combination of private land and a more business-friendly environment are allowing the most energy-transformative development in our nation since Edwin Drake struck black gold in 1859.
Obama’s refusal to allow drilling on federal lands where we know there are enormous oil deposits (which we now have the technology to extract) is a of a piece with his desire to increase taxes and government dependency: Imagine the potential tax cuts (or, if you are a Democrat, imagine being able to avoid spending cuts) if the western United States were a literal gushing well of tax revenue to the federal government.
Again, this is not a theoretical issue, nor one that should divide Americans on class lines. This president’s anti-real-energy policy is a disaster for all Americans, but especially the working poor and the middle class to whom Obama’s every non-energy related utterance is a transparent pander.
It is time for Republicans to push hard on this issue, to remind voters that Barack Obama is costing them hard-earned cash every single time they fill up the car, shop at the store, or heat up their homes — and that that’s just how he likes it.
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