At The GOP soiree in the House today:
While the U.S. oil industry wants access to more federal lands to help reduce reliance on foreign suppliers, American-based companies are shipping record amounts of gasoline and diesel fuel to other countries.
A record 1.6 million barrels a day in U.S. refined petroleum products were exported during the first four months of this year, up 33 percent from 1.2 million barrels a day over the same period in 2007. Shipments this February topped 1.8 million barrels a day for the first time during any month, according to final numbers from the Energy Department.
The surge in exports appears to contradict the pleas from the U.S. oil industry and the Bush administration for Congress to open more offshore waters and Alaska’s Arctic National Wildlife Refuge to drilling.
“We can help alleviate shortages by drilling for oil and gas in our own country,” President Bush told reporters this week. “We have got the opportunity to find more crude oil here at home.”
Anyone? Might make for some interesting discussions when mentioned in conjunction with this:
Chevron Corp. said Friday that its second-quarter profit rose 11% to a record $6 billion, even though production slipped and the San Ramon, Calif., company lost money refining and selling fuel.
Someone tell Lou Dobbs that we are shipping oil to furriners. Pretty please.
It really pains me that people think the solution tto our problem is as simple as “DRILL MORE!”
liberal
What I don’t get is why you’re against a windfall profits tax.
There’s nothing wrong with oil companies making a tidy profit on their capital investment.
OTOH, there’s something dreadfully wrong with them taking oil wealth that property belongs to US citizens.
When oil prices go up, 100% of the windfall should go to the US Treasury, because that money is pure economic rent, and hence can be taxed away without hurting economic efficiency or economic justice. (Ask Adam Smith or John Stuart Mill.)
montysano
If they didn’t believe that, then they might have to face reality, and we all know how most Americans feel about reality: they despise it. The reality: we’re going to have to make substantial changes in how we live and how we run our society. The question is: how will this play out? As a fight to the death for a declining resource? Or will we get smart and institute an “Apollo program” for energy?
Obviously, we should take the hundreds of billions of $$$ that we’re pouring down a hole in the Middle East and redirect it to more pressing matters hear at home. However, Halliburton, Bechtel, et al would disagree, and so there’s your problem.
4tehlulz
HEY GUYZ WE SHOULD DRILL FOR MORE OIL SO THAT WE CAN LOWER GAS PRICES BY SHIPPING IT OVERSEAS
BY DOING THAT, WE CAN TRADE MORE AND BUY OIL FROM SAUDI ARABIA AT LOWER PRICES
ANY SUGGESTION THAT WE DO OTHERWISE IS OBVIOUS LIBERAL TREACHERY
ALSO, COCKS
Tim H.
Any country that handsomely rewards war profiteering isn’t going to have a problem with selling a little gas or diesel overseas if there’s money to be made. And yes, the GOP will still loudly bitch and moan because there’s still some money left on the table they haven’t got yet.
toujoursdan
It’s rather silly to think that an American oil company would only drill and sell oil to Americans. Exxon-Mobil, Chevron and the others have always operated on the international market. Most of the gas stations here in Ottawa are run by the American oil companies, Shell or BP.
The two highest exporters on the list: Mexico and Canada are supposed to be part of one market with the US due to NAFTA. Short of abrogating the treaty (which I would like to see happen), that isn’t going to change.
It’s always been a bit of tortured thinking that the right-wing free marketers who have supported globalization somehow think that the U.S. can shut itself off from the world economy, keep oil at home and somehow escape rising international oil prices. The market doesn’t work that way and they only have themselves to blame for that state of affairs.
Incertus
I think it’s inevitable that we’ll have offshore drilling eventually–there’s too much money to be made doing it. Probably in ANWR too, though that’s still a tougher sell. The real question is what are we going to get in exchange?
Ricky
I can see the B movie trailer in my mind. The sinister announcer voice over begins as sharks circle in the sunny Gulf waters. “THEY’RE BACK. THE SAME PEOPLE WHO COULDN’T FIND OSAMA BIN LADEN OR SADDAM’S WEAPONS NOW WANT TO FIND THE OIL GOD HAS HIDDEN BENEATH THE SEA.
AkaDad
The problem with the windfall profits tax, is that there will be less money for the oil companies to combat the climate change hoax.
dorkboy
McCain has basically come up with two proposals to reduce fuel prices: The gas tax “holiday” and increased drilling.
The “holiday” didn’t pass the laugh test and the media correctly debunked it and not as simply some counterpoint posed by Dems. But rather as a simple economic fact that it wasn’t going to work.
For some reason with drilling, the media has laid down once again and allowed this stupid idea to seemingly have merrit. And when they do report the “downside” of this idea it’s simply posited as the Dem’s side of the argument. Case in point, last night on ABC they had Nancy Pelosi be the person who noted the report that says that the results of increased drilling would be 2 cents per gallon in ten years. ABC of course didn’t cite where this credible figure came from, so it’s simply McMaverick’s word against that commie Pelosi’s.
That’s how the public thinks drilling is the answer.
Jake
The very basic argument against the windfall profits tax is that the oil companies will pass on the added expense to the consumers.
Is anyone aware of a reputable economist who’s looked at this issue in any detail? I’d just like to read a coherent argument for it. I’ve yet to find one that debunks the standard arguments against it, piece by piece.
montysano
@ toujoursdan
Unless you let Rush and Sean to drill that idea into your head for 6 hours every fucking day.
@ incertus
There’s already plenty of leases in existence for offshore drilling; the oil companies have yet to exploit those leases, most likely because there’s not enough oil and it’s too expensive to extract. Same with ANWR: it’s not exactly a place you can drive to, set up rigs, and start poking holes in the ground.
toujoursdan
My big fear is that, if peak oil has arrived, as people get desperate, more and more environmental standards are going to get tossed to the wind to keep the lights on. Ultimately, throwing them out will do little to alter our predicament and we’ll end up leaving an even more trashed planet to future generatios.
nightjar
They own the whole Kit and Kaboodle. But, but it’s the free market and competition and supply and demand that causes the high price of gas. What a scam.
Next they’ll be clamoring how they need monthly deductions from your paycheck so as to pay for test wells in your back yard.
Dennis - SGMM
I think that wringing out the last few drops of oil in America to provide chimerical relief from high gas prices is brilliant! That way we’ll soon be completely at the mercy of anyone who does have oil. It’s a comfort to know that eight years of Bush diplomacy have assured that those nations who do have excess oil to sell; Iran, Iraq, Saudi Arabia, Russia, Venezuela, etc., all love and respect us so much that they’d never even think of charging us just enough to keep us on the verge of collapse.
JGabriel
I guess that’s why Republican Congressmembers are so eager to stay in DC for their “Phantom Session” instead of going home to campaign.
I mean, who wants to answer questions from constituents? Especially on news like:
Yeah, I’d prolly want to stay in DC too. Even in August.
.
Incertus
Oh, I get that. And trust me, the last thing I want to see when I head to Fort Lauderdale beach is an oil rig and the water with that lustrous petroleum sheen on it. I hope Pelosi is successful in delaying the drilling. But I think eventually, the huge sums of money out there, especially once peak oil really starts to take hold, are too big to hold back forever. So we better get something in exchange for it.
Punchy
OT–
A Sean Tevis update: that KS Politician guy y’all gave scratch to for his funny website, yeah…he collected just short of $100K.
Here’s the bad part — I have just moved into “his” district. Not. A. Single. Sign. Anywhere. Nothing. 6 figs from a cartoon and he’s devoted $0 to advertisements, from what I can see. Money well-spent….doubtful.
Skullduggery
It seems like Republicans focus more on developing policies that satisfy people’s emotional needs while Democrats tend to focus more on policies that satisfy our actual needs. See offshore drilling, security theater, ferrner hatin’, etc.
Maybe the Bush & McCain “psychology” flaps were just slips that revealed their inner feelings wonk.
Ed Drone
Damn that air-conditioning! Now we’re stuck with these schmucks all 12 months of the year. Used to be they’d get out of our hair for a short time, anyway.
Damn!
Ed
The Thinking Man's Mel Torme
Go to Ft. Lauderdale, then, without worry. You won’t see platforms on the Atlantic side, because the oil is on the Gulf side. The effects of a spill would be considerably worse on the Gulf side, as the coastline is more of a natural state, more irregular with lots of mangroves &c to trap the oil. The west coast also has little besides tourism to support it, so prolonged effects from a spill would be cataclysmic. Doesn’t stop the wingtards from howling “DRILLNOW” in the local fishwrapper, though.
Back in the Gerry Ford years, when my family used to vacation in Pompano Beach, the oil tankers used to flush their bilges with seawater. This would form blots of tar all up and down the beaches, so that every place from the lowly three-story motels to the Fountainbleu had to have bottles of mineral spirits for the guests so they could clean the gunk that inevitably adhered to one’s feet. Good times, soon to be here again!
jake
Yep, give the oil companies more places to drill and they 1) Won’t pass on the cost of drilling to the consumer; 2) Certainly won’t just squat there and refuse to let anyone raise a wind farm or solar collectors on the land how dare you even suggest such a thing?
I wish the Dems would call their bluff. “Sure you can drill, but you’ve got five years to produce oil starting … now!”
Reverse that psychology, sucka.
Tim H.
I think it’s inevitable that we’ll have offshore drilling eventually—there’s too much money to be made doing it.
I’m not totally sure this is true anymore. Sure, the oilcos want the leases now because they can book the reserves and get a stock jump, but when push comes to shove and they have to drop 2-3 billion to build an oil platform it’s another thing entirely. Even a ship to drill test holes costs a half a billion. And the price of big things like platforms is going to go up in lockstep with the price of oil.
Slugger
I hope this isn’t a stupid question, but why would the oil companies want to drill more even if we gave them the right to? The oil companies are making record profits selling expensive oil. Why would they spend the huge amounts of money that it costs to explore in the Arctic and on the continental shelf in order to lower the price of the products they sell? Wouldn’t that be like DuBeers working to lower the price of diamonds?
Brachiator
Of course, part of the thing is that there is no such thing as foreign oil or domestic oil. Oil is a commodity on the world market, and unless you are going to nationalize American oil companies, you cannot force them to sell “American” oil only to Americans.
Back in the 1970s, the Alaskan Oil pipeline was promised to help end America’s dependence on foreign oil. Didn’t happen. On top of this, the major owner of The Alyeska consortium of oil companies that own and operate the Trans-Alaska Pipeline System is not an American Company, but British Petroleum. And, golly gee, here we are again.
Any time any Republican comes out with this bullshit, it should be an FCC regulation that a map be put on screen (or equivalent audio) that shows the big ass portion of oil reserves in the Middle East and the tiny ass portion of oil reserves in the US.
It’s also typical that the phony debate “To drill or not to drill, that is the question,” lets Congress and the presidential candidates evade questions about seriously raising fuel economy standards.
This is more phony BS pushed by conservatives who don’t really understand crap about economics, even though they love to talk about how hard headed they are.
On the other hand, information about the failure of previous windfall profits taxes to accomplish anything meaningful can easily be found, here or here, for example.
By the way, the major reason that oil companies want to drill offshore is that it would insulate these profits against the uncertainty and risk that comes with oil production in more volatile places such as the Middle East, Nigeria and Venezuela.
And of course it gives the Bush Administration cover, pretending to address energy issues while doing little more than helping his oil patch buddies.
liberal
Jake wrote,
Can’t happen.
The supply of natural resources is fixed, so the price of crude oil itself is set only by demand.
If you draw the supply and demand curves, this means that any tax levied on the oil itself is born only by the oil company. (Assuming the tax is low enough so that it’s feasible to pump the oil out. Also, we’d want companies to profit on their capital investment, to encourage further exploration.)
The usual result in economics concerns land. If you tax land itself (not improvements like buildings), the landlord cannot pass the tax onto the tenant. This has been known for hundreds of years, ever since Ricardo formulated his law of rent. (Adam Smith probably knew it, however, even though the law of rent was unknown in his time.)
In the case of oil, the value of oil is fixed by demand. The “profit” (which is really rent, not profit) is the value per barrel, minus the cost of extracting that particular barrel. (So the rent on easily extracted oil is much higher.) The point about the oil company not being able to pass on the tax is equivalent to saying that the rent is fixed (assuming a given level of demand). Either we can give most of it to the oil companies for free (as I’m pretty sure we do now), or we can keep it ourselves (after all, we as citizens are the rightful owners).
NB: I’m using “windfall profits tax” in a very loose way to mean a way to recover the natural resource rent of oil. The problem is that “profits” means a return to capital, and oil companies shouldn’t be punitively taxed on their capital. But “windfall” denotes IMHO rent.
Gus
But real solutions make my brain hurt! Drill more is nice and easy.
bootlegger
Exactly!! And those dumbass Democratic leaders should be hammering this point home every second of every day. This is the winner in the debate and I only hear it here and at my favorite pub.
Dreggas
“Drill more” sounds quite similar to “Frontal Lobotamie for everyone!”
Phil
“It really pains me that people think the solution tto our problem is as simple as “DRILL MORE!””
Hey John, I know liberals are stupid (being educated in public schools and all) but I’ll say this really really slowly so you can follow along. Some of us* think that the alternative energy pixie dust fairy won’t be able to deliver her magical alternative energy pixie dust immediately. You see, she’s got a lot of routes to run and she can’t do it overnight like Santa Claus. It might even take her several years, even decades! for her to spread her magical alternative energy pixie dust throughout the land as we transition to next generation alternative energy.
In the meantime, those mean evil Republicans and some other schlubs* have come to the conclusion that perhaps we should produce more of the proven energy reserves we have in the United States as we await the alternative energy pixie dust fairy to grace us with her presence. They say this because $4 dollar a gallon gasoline is starting to really hurt a couple of yahoos*.
No worries though – this group is small* and should simply be ignored. Remember, this is the “politics of change” era where if you aren’t a transnational progressive citizen of the world, then it’s best if you shut the fuck up and just listen to your betters. And if you can’t afford to leave your house, well pain works motherfucker! Go inflate your fucking tires!
So let’s recap John: Alternative energy good but not overnight. In meantime, produce more proven energy as transition occurs.
I know, this is just crazy talk and an idea shared by only a few rural and suburban whackjobs* so it’s best to just pretend they don’t exist.
*Somewhere between two thirds and three fourths of the population, and growing with each and every poll
Kat
>> Could Someone Mention This At The GOP soiree in the House today
Hey, I did my part — I emailed it to Tim F.
I also emailed it to my Representative, who’s a Dem, advising her to pass it around to others in the House.
Thanks for ‘getting it’, and for posting about it.
Kat
Why is it that trolls never read the news?
Also, every deep water drilling rig in the world is already leased for the next five year.