Dems: we object to off-shore drilling, even if gas is $10/gallon

It's not just a numbers thing...Don't listen to me...Listen to the professor teaching very intelligent students at Harvard...By conserving more,...AND enacting a policy which enables us more production control, the market conditions being as they are will have an immediate impact...Others on your side have joined the dark side because understanding markets is key to this...I am all onboard with conservation...I'll spread the word. You won.,...but I need your support on this that you must allow the market to work the way it does and is suppose to....

 

I think of this issue as the true definition of partisanship...neither side will give an inch despite each side having merit.

My gut says that if we took a vote that said drill offshore and invest much more heavily in alternatives, 75% of the population would be in favor of it. But thats too logical and therefore not an option. Instead, politicians will continue to pander to special interests (corn, oil, environmentalists, etc) instead of developing a comprehensive plan.

Obviously oil can't be the answer forever. Nor is it good for the economy to have $4 gas, 30% of our corn going to ethanol, greenhouse emissions from cars, or sending trillions (over multiple years) overseas.

This board seems no different than much of Congress when it comes to this issue. I mean people argue that drilling offshore won't decrease prices today (which is obvious since supply isn't increasing today - ignoring the futures/speculator impact) - except worrying about only today is what got us here. If we had been thinking about the long term in the 90s, we'd have more alternative fuels, more domestic supply, and more fuel efficient cars. So here we are 10 years later and now that its biting us in the butt, we're trying to do something - in the mean time we have this foreign tax on our economy thats affecting everyone (not to mention only further weakening the dollar).

Its also foolish to assume that a 1% increase or decrease in supply should only affect pricing 1%. Its not a linear relationship. The reality is that when supply and demand are that tight, any slight shift is going to cause massive volatility.

We talk about fuel efficiency and how SUVs are to blame - well if we doubled fuel efficiency (i.e, cut motor fuel demand in half in this country) - demand would drop by 4 mm barrels a day (the rest of US consumption goes to industry). Thats 5% of global demand. Would you assume that a 5% reduction in demand is only going to reduce pricing 5%? No. Obviously we'd expect a much bigger drop in pricing which is why its so important to keep reducing fuel demand - otherwise you can't blame those fuel hogs.

Its funny b/c a bad domestic electricity policy atleast lines the pockets of domestic companies, shareholders, employees, etc....bad energy policy is lining the pockets of foreign governments/economies and I think thats why it really bothers me that we're so partisan that we can't work out some sort of compromise. The reality is, the longer we wait, the longer a solution will take to come into play.

 

Right, it will help the gas price, but why should that stop us from doing it?

It's absolutely foolish to not do it when it clearly has no negative impact on anything.

The Dem leadership in the Congress are foolish to make this an issue. This is a non-issue.

 

Repubs- We don't object to off-shore killing, even if it costs $500 Billion.

 

translated, i agree with obama but i'm to petty and immature to admit it

 

This is called something that Republicans might want to start looking into. It's called the possibility of compromise.

just a thought

 

Here's a short article I found interesting from this month's Portfolio about how the media influences the public perception of energy policy. As media becomes more corporate and bottom line oriented it's going to be harder to get objective information and opposing points of view. How can the public make informed choices when the media is controlled by advertising dollars and the government gets all it's information from lobbyist?




If journalists aren't asking the right questions about prices at the pump, then who is?

by Denis Johnson

When it comes to the cost of gasoline, who should we believe? Here are some nominees and their viewpoints:

1. The oil companies: It’s supply and demand at its most basic, just like your professor outlined in your freshman economics course.
2. The petro-toadies in Congress: All we have to do is open up the Arctic National Wildlife Refuge and the waters off Florida and California.
3. The Department of Energy: OPEC has to pump more, and we’ve got to allow more refineries by rolling back environmental restrictions.
4. King Abdullah: OPEC pumps plenty of crude but “despicable” oil-futures speculators in the West are driving up the prices due to their “selfishness.”
5. Senator John McCain: Exxon Mobil has done such a good job of demonstrating the magic of the marketplace that it deserves another $1.2 billion in tax breaks.
6. Senator Barack Obama: Impose a windfall-profits tax to remind American oil executives that price gouging can backfire politically.
7. About 90 percent of the print and TV reporters in America: See No. 1. It really is that ol’ devil supply and demand.
8. The White House: Never mind. Nobody’s home.

For my money, a sounder answer as to whom to believe is Don Barlett and Jim Steele, the investigative reporting team that has won two Pulitzers and two National Magazine Awards for exposing government theft and corporate greed. Their 2003 series for Time magazine on oil economics remains required reading for anyone who wants a better understanding of how gas at $4 to $5 a gallon represents a carefully arranged screwing of consumers. “The bottom line for the oil people is, How much can I make while spending the least I can get by with on refineries, synthetic fuels, and for exploration and drilling on the vast, unused acreage in existing oil leases?” Barlett says. He notes that Canada has become the United States’ No. 1 oil supplier by funding joint government-*industry exploration of the tar-sand fields of Alberta. “The most chilling statistic is Exxon Mobil’s. It spent twice as much last year to buy back stock as it did on exploration.”
As for shallow journalism that helps Big Oil, Steele makes the point that the newsrooms that were once staffed by the redistributionist children of the New Deal and the A.F.L.-C.I.O. are now populated with the children of Reaganomics: “Younger reporters come out of a mind-set that the market rules, taxes are evil, and government ought to let these people in the oil industry go about their business.”

As journalism has passed from a hungry to an elite profession, there’s no shock value in the fact that Exxon Mobil paid only $5 billion in U.S. income taxes last year while it paid $25 billion to foreign governments. Even with Exxon Mobil making $76,000 a minute, the last thing that occurs to many assignment editors and reporters is to investigate whether a windfall-profits tax would drive Exxon Mobil, BP, and other oil companies to invest in the alternative-energy strategies they boast about in their television commercials.

Then there’s the problem of letting general-assignment reporters, rather than energy specialists, cover gasoline prices mainly as a story of consumer suffering. About 40 percent of U.S. oil is produced domestically, and Washington has declined to regulate auto fuel as an essential commodity. That’s where the vertical integration of a giant like Exxon Mobil creates market leverage. It owns oil fields, processing plants, and retail outlets, creating some monopoly-like advantages in controlling supply and fixing prices in the U.S. market. Then there is the remarkable job that the oil companies have done in persuading network-TV anchors and correspondents to depict them as they want to be seen: powerless victims of a supply-and-demand cycle that is as immutable as gravity and as random as lightning. Congress, responding to demands for tougher laws on oil speculation, would prefer to blame environmental regulations. Much of the context-free reporting about what the executives say, in Congress and on television, is marked by breathtaking gullibility.

Speaking of television, no one of any age can doubt that the industry’s star performer in the public relations battle over gasoline prices is Rex Tillerson, chairman and C.E.O. of Exxon Mobil. His appearances on the Today show have become five-minute promos for price escalation, with Matt Lauer cast as the surrogate for a nation of consumers who don’t fully understand their role—helpless and sacrificial—while the company maximizes shareholder value, “our reason for being.”

This is a “demand-driven price runup, no question about it,” Tillerson drawls, fingers intertwined and as fidget-free as Chance the Gardener. Lauer gamely zeroes in on Exxon Mobil’s dirty secret—that it spends only 5.3 percent of revenue on exploration at a time of record revenue. “If you’re making $400 billion a year, should consumers expect you to pay or spend even more on exploration?” Lauer asks.

The unflappable Tillerson describes this modest expenditure as “very, very robust.” He adds, with apparent conviction, “We would do more if we could gain access to more areas.” In other words, give us ANWR, then we can talk price at the pump. In fact, no unbiased expert claims that exploiting the fields in the Alaskan wilderness would cause more than a bump in world supply or prices in the U.S.  By the way, Tillerson observes, the industry needs more refineries too.

Lauer, charmingly outpointed at every turn, finally blurts, “Mr. Tillerson, you’re always nice with your time.”

“My pleasure, Matt,” the oil king rumbles, not a hair out of place on his salt-and-pepper corporate coif.
And it was, no doubt, a pleasure for him to slip out of Rockefeller Center, built with Standard Oil dollars accrued in an earlier era of rapacious pricing, without addressing the oil-company claims that are most easily disproved by that old-fashioned journalistic method called reporting. The plain truth is that the record profits cited by Lauer—$10.9 billion in the first quarter of this year for Exxon Mobil—reflect an industrywide decision to flow revenue directly to the bottom line rather than to capital expenditure. To buy Tillerson’s story, you’d have to believe that profit is an accident, when it is, irrefutably, the result of a company strategy tailored to this unique moment of opportunity.

Oil executives generally believe in an updated version of the peak-oil theory, introduced in 1956 by geologist M. King Hubbert. It posits that because of oil-field depletion and the expense of production, American-oil-industry output will reach a maximum level and then start to decline. An updated version of Hubbert’s bell curve—which factors in the number of wells being drilled and refinery capacity—sets the year that the peak will be reached at 2020. If you’re getting a prime price for a product that will be harder to acquire in a few years and less valuable due to competition from other fuels, the smart play, obviously, is to divert every penny into profit while the Black Gold Casino is still open. To confuse the press and public, you set up several straw men to take the blame for the supply shortage that you’ve seen coming for a half-century: refinery capacity, environmental legislation, and the imaginary supply potential in undrilled portions of the continental shelf and ANWR.

But let’s look at the Cheneyesque fantasy that drilling in ANWR is a major national-security priority that would make us less dependent on foreign oil. The fact is, the Trans-Alaska pipeline that is supposed to bring us that new ANWR oil probably couldn’t handle it right now because lack of maintenance has left it in bad shape. (Business Journalism 101: You can reinvest revenue in infrastructure or pull the money out as profit.) Plus, there’s not enough Alaskan oil to affect price. It would be gone in a few months if we could pump it at maximum capacity. From a national-security standpoint, the smart thing would be to leave it in the ground for use in case of some future civilization-threatening cataclysm.

Oil-friendly members of Congress like to blame environmental regulation for the lack of refinery capacity. But the oil companies themselves choked supply by closing more than half of their 300 U.S. refineries in the past 25 years. (Business Journalism 201: You can reinvest in manufacturing capacity or ride the demand curve to higher profits.) Studies by Cambridge Energy Research Associates, a respected, oil-friendly consulting firm, indicate that even if all environmental regulations were removed from refinery construction, few would probably be built right away because of a 75 percent rise in construction costs since 2000, largely driven by the increased fuel cost of transporting building materials.

I don’t mean to imply that when it comes to cutting through industry and congressional malarkey, Barlett and Steele are the only game in town. The Chicago Tribune, the Wall Street Journal, Texas Monthly, and other publications have all done credible oil series during the past few years. The problem is that headlines on today’s pump prices trump the revelations of yesterday’s in-depth reporting. The digital-news era is good at letting us know what happens now. But it’s lousy at reminding us of what’s happening again. Take the richly symbolic case of ANWR. Oil executives know that they haven’t explored 80 percent of their existing leases in the continental U.S., according to Barlett. But they also know that if they can crack the wildlife refuge, Congress will lack the political will to keep them away from the other government land and the ocean floor they covet. In that sense, ANWR fits a historical leitmotif. For more than a century, oil companies have been gaming the federal oil-leasing system to receive bargain prices on the raw materials under public ownership.

Oil companies have always depended on the transfer of unpumped oil from public to private ownership. In the Teapot Dome scandal of the early 1920s, oilmen bribed officials at the Interior Department to gain ownership of an oil field owned by the U.S. Navy. With ANWR and the offshore leases, everything will look aboveboard if Congress and consumers can be whipped into a demand-driven frenzy. Oil companies will blame the Arabs and environmentalists for a supply shortage they’ve maintained as a matter of policy since the days when the Texas Railroad Commission set quotas on how much oil could be pumped out of the ground.

Decade after decade, the oil companies claim that they would pump more if only they were allowed to. Barlett calls it playing the short-supply card. “Every freaking reporter out there falls for it,” he says. “And if I’m the P.R. guy for an oil company, I’m going to play that sucker for all it’s worth.”

Supply and demand? Sure, but as John Lee, a business journalist at the Wall Street Journal and the New York Times for many years, reminds me, supply and demand in oil are not just “two pie charts—where it comes from, where it goes, measured maybe five years ago.” There are more complex reasons for pain at the pump. “American gasoline prices have always reflected the latest spot price, namely what you have to pay to buy bulk gasoline on the open market. This is last-in pricing, rather than pricing based on inventory costs.”

Now, let’s say you’re an oil company selling bulk gasoline, and suppose your inventory contains some gasoline made from $140-a-barrel oil and some that was purchased for $75 a barrel. That leaves a lot of room for price manipulation. But please, whatever you do, don’t think for a minute that’s what Tillerson and Exxon Mobil are up to. Just like you and me, they are powerless slaves in the fields of supply and demand. Now tote that barge, lift that barrel.

http://www.portfolio.com/views/columns/media/2008/07/16/Criticism-of-Medias-Energy-Coverage

 

Just force the speculators to cover their bets, stop letting them make huge speculations on only a 5% investment...force them to come up with the money to bet on futures.....


Also, am I the only one who wants this country to go away from oil? The high prices are atcually spurring innovation....which has to be good overall, right?

DD

 

Obama laid down like a Tank Abbott against Kimbo Slice on this issue.

Weakness is not the sign of a good leader. Again, this guy flips and flops based on the opinion polling of the day. Just simply in over his head. Obviously, Obama doesn't understand the issue -- he's just saying what he thinks people will want to hear... 70% of Americans favor offshore drilling.

Obama just simply doesn't have the strength of character to lead.

 

which is worse, to compromise on an issue in order to get a larger plan implemented, or to compromise on your values (like flip-flopping on energy, affirmative action, abortion, taxes, the war, social security, education, negativity) like McCain has in order to get his party behind him?

I bet you can't respond.

 

No it's Obama realizing his dumb position was going to cost him votes.

 

wow, a candidate who believes the world isn't black and white, how terrible

 

actually he didn't change his position. he's still against it. but said he would be willing to compromise if it would allow his larger energy plan to be pushed through.

this is how a leader gets things done.

 

A good leader listens to differing opinions, makes the best choices he can at the time but can change his mind in light of further information. And yes, the voice of the people can be considered information. All this crap about waffling being a sign of being weak is BS.

Putting ego before pragmatism is weak, putting dogma before reasoning is weak. That's exactly the kind of leadership that we've had for 8 years and it is a recipe for failure.

A wise man knows what he doesn't know. A good leader is constantly correcting his course for the best route to the solution.

(and if you don't get elected you you can't do anything, so yes, getting elected is objective A)

 

Given McCain's:

Timetable = surrender
Americans support timetable
16 Months sounds great!

I think you're left with Bob Barr as your only option.

 

Actually he believes the world is black and white -- it just depends on who he is talking to!



FLIP FLOPOWNED

 

yes your 100% right TJ..We need a leader that makes up his mind on a gut feeling and sticks to it no matter what information comes to light... WE need a leader who believes that his current mindset is correct and will always be correct...

ARE YOU THAT DUMB??? I hate dumbass who point to "flip flopping" as a bad trait...since when did re-analysing your viewpoints when presented with other facts and views equate to bad leadership??? STFU

 

100% agree...but its sad that this way of leadership has been demonized by the Reps as "flip flopping"... its sad that most americans dont even realize this...The american people deserve bush for their sheepish mentality