Its pretty obvious the recent run up of gasoline prices had less to do with supply shortages and more to do with driving up the cost of oil. So why do we hear from the oil companies that they need to drill immediately in ANWR and the continental shelf to ensure the shortages that don't exist won't continue. Why do we hear the republicans demanding that we drill now when it's common knowledge that it will take several years before any drilling can actually take place in areas currently not leased by the drilling companies? Why do we see the Democrats capitulating on the issue when the cornerstone of the Democrats energy plan is to wean ourselves from fossil fuels?
The answer to these questions is Greed and Ignorance, greed on the part of the oil companies and their lapdogs in the federal government and ignorance on the part of the American people. Now I can understand the oil companies' actions and their sense of urgency but I don't understand the American people and their insistence upon shooting themselves in the foot. I feel the pain of $4.25 gas and the corresponding inflation in the prices of most goods and services as much as most Americans. But there has to come a time where we as citizens must toughen up and make the necessary changes to cope with the nations energy problems, not complain and whine as if we can't stand the pain. We must pull together as a country and do the right thing for ourselves for a change. We must demand a fair shake from the oil companies for the natural resources that belong to the American people.
We must make substantial changes to current laws before we give up the rights to natural resources such as oil and natural gas on lands leased to drilling companies. We need to change existing law to allow the federal government to collect the appropriate amount of royalties in lieu of being under paid by the oil companies. In light of record profits we need to take away the corporate welfare known as incentives as well as tax breaks for oil companies drilling on federal land. We need to increase the fees for oil and natural gas that is harvested from the leases. We need to put some teeth into enforcement and oversight of the leases if the recent sex and corruption scandal in is any indication. It is time to hold the CEO's of these oil companies not just financially responsible but morally and ethically responsible for the conduct of the companies they lead as well as holding our public officials and employees to a much higher standard. We need to ensure that the companies that drill on public lands are held to high environmental standards while drilling and harvesting oil and natural gas on public lands. We must insist that these companies be financially responsible for environmental problems caused by their operations on these lands and in the oceans.
"Yet there is another compelling reason to oppose the plan: the federal system of offshore leasing has been characterized by gross mismanagement that has allowed big oil companies to avoid paying billions of dollars in royalties. There is no reason to doubt that an expansion of drilling leases would bring more of the same."
After all it's our natural resources the oil companies want to put on the world market, and then charge US consumers $4 a gallon (while raking in record profits), not theirs and we as owners of these natural resources should expect more return on our natural resources.
When these conditions are meant then we need to lift the moratorium on ANWR and the continental shelf. Then and only then should we allow our government to lease any additional areas for drilling by the oil companies.
To hear what the has to say on the subject.
Submitted by j2j2
J2t2@q.com
j2t2, Congress is trying to pass a bill that will address and amend many of the issues you raise. Regrettably, Pres. Bush has said he will veto it due to tax hikes on these record profit making corporations.
I am backing the bill because it strikes the right balance, giving the individual states the right to approve off shore drilling or not out to the continental shelf end.
Your raise the most fundamental issue to this energy crisis of any made, the fact that the oil reserves belong to the American people, and it is being frittered away with no good for the taxpayers or the consumers with inordinately low lease rates whose revenues are not targeted to benefit consumers, and federal taxes on energy which are not directed to address our oil dependent, and fossil fuel dependent crisis in the making.
Energy is so fundamental to ALL of American life, that it should not be left in the hands of private shareholders and executives whose myopic obsession is with manipulating actual and perceived supply and demand ratios in order to maximize profitability.
What good does it do to drill baby drill if our refineries are already running at or near capacity with the volume of oil already passing through them? Where are the oil industry's investments in expanding refinery capacity to accommodate increased oil supply on a daily basis some 7 to 10 years from now? Answer: Where is the profit in that?
I rest my argument on that sour note.
David the little I have heard about the bill being discussed in Congress is good in so far as it is a compromise that allows for "drilling offshore" and supposedly forwards the alternative energy cause. I haven't heard that the Congress is considering any increase in royalties which with removing the corporate welfare should preclude additional taxes. However the dems just seem to want to raise taxes in lieu of collecting royalties. Perhaps it is because the royalty system is so corrupted with the prevalent inbreeding of corporate lackeys currently serving as public officials.
I will continue to prepare my daughter for moving to Brazil or Japan for employment, just in case McCain is elected. Though I didn't want to believe it, logic dictated after the 2000 election that Americans could easily reelect Bush, and find a suitable replacement just like him for 2008. My worst fears are being realized.
But, hey, Brazil has really gotten their act together since their 1998 liquidity and credit crisis similar to ours today and they have CarnivaL !!! My daughter will love it if she is forced to seek employment and a lower cost of living there.
I agree with your article wholeheartedly, but
would add a couple of important elements. First,
the commodities market needs to be regulated.
Speculation on oil futures drives price. Due to
the critical nature of this commodity to our
economy and national security, speculation needs
to be looked at, maybe stopped or heavily
regulated. Second, in order for our country to
become independent of oil, we need leadership
from Washington. Start with the premise that we
are going to alternate forms of energy. Perhaps
the quickest first step would be to convert auto production to CNG vehicles and begin building
cng filling stations. It works, its the cheapest way to have an immediate impact (ask Boone Pickens). It would signal to OPEC...we ain't
foolin around. and keep their prices down in the
interim while other alternate sources are developed. It could be an economic boost to this country. If the government invested in small
businesses, in R & D, and in educating future
scientists and engineers this country could build a 21st century economy like no other. The sheiks will go from their Mercedes back to camels. And the big oil companies will either
invest in the new initiative or fall by the
wayside eventually. Of course it all sounds
good...we are missing the most important
commodity of all...leadership. Hopefully President elect Obama can fill this void, but
he can't do it alone...we need to lean on the
ideological, Pork barreling Congress to back
Obama up or face the wrath of the people.
Bob, you are dead on the mark here. Obama would do well to impose higher gasoline taxes to keep the incentive for alternative fuel sources moving ahead, and designate the revenues from those revenue increases toward infrastructure maintenance and building to offset increases in deficit spending.
It is the kind of move special interests will attack adamantly. But, if the American people would back the move, we could see real progress on the energy future the American people hope for. I am not proposing taxes that jack gas prices up to $4.25 per gallon again. That hurt the economic growth that we desperately need to promote.
But, there is a mathematical calculation that can be used to determine the minimum negative consumer effect with maximum alternative energy development effort and investment, that would make sense to the consumers and conscientious people driving the alternative fuel development effort forward.
Obama is the person who could best speak to this sweet spot compromise that addresses present need, future need, and fiscally responsible path to meet those needs.
The very same speculators that drove the price to over $4/gal. are the same now driving the price of oil toward $25/barrel, and unsustainable trough price. There is a need for regulation and the kind of wild speculation that leads to peaks and troughs that damage the economy and harm consumers in their efforts to budget and plan their financial needs and resources.
There is nothing wrong with buyers bidding on the price of future oil contracts. There is something horribly wrong with NON-Buyers driving the price up only to sell those contracts to an actual BUYER. A common sense approach to address boom bust speculation is to draft trading rules that stipulate that bidders MUST demonstrate the capacity to take receipt of the oil or gas they are bidding on. That one simple regulation would eliminate the profiteering speculators from playing havoc on the markets they have no intention of participating in from a commodity buying and selling position.
Thank you Bob for your comments.
The commodities market was regulated and we didn't have this problem. Phil Gramm reared his head and made changes with his commodities futures modernization act and included it within another bill in Clintons last days as president and it went through unchanged. In June of 2008 another bill S3134 was introduced into Congress to curb the excessive speculation that was the primary cause in the recent surge in oil prices. You will notice that immediately after this bill was introduced the price of gas started downward and has continued to come down since.
http://www.govtrack.us/congress/bill.xpd?bill=s110-3134