A lot of things that a President cannot control can gravely affect his chances of being reelected. In 1979, the combination of an oil embargo and the Iranians taking U.S. diplomats hostage ended any hope of a second term for Jimmy Carter.
As this is written, there are 19 U.S. citizens being held hostage in Egypt, but you are hearing little to nothing about that in the mainstream media.
The economy is going to affect President Obama’s odds of being reelected this year and Americans who are notorious for gaging the impact of inflation by watching the cost of gasoline at the pump rise are going to blame Obama. An attack on Iran’s nuclear facilities and a possible conflict will drive prices through the roof.
When Obama took office, the average price of a gallon of gasoline was $1.61.Averaging $3.50 at present, the price of a gallon of gas is predicted to rise to $4 and even $5 by summertime.
If the U.S. was not dependent on imported oil, we could control our own fate, but for decades every effort possible has been made to drive up the cost of automobiles and gasoline, led by environmental organizations like Friends of the Earth and the Sierra Club, two notorious anti-energy foes, in combination with the Environmental Protection Agency.
Little wonder they are in a full war against the Keystone XL oil pipeline from Canada or that the Obama administration has been trying to convince Americans it favors opening access to existing and new oil reserves.
Dan Kish, vice president of the American Energy Alliance, recently took note of the political maneuverings over the American Energy and Infrastructure Act of 2012, saying “At the end of the day, the American people don’t care whether federal lands are opened in one large piece of legislation or in separate smaller pieces.”
“The bottom line is that the Federal government currently leases approximately 2.4 percent of the land owned by U.S. citizens, while lands equaling ten times the State of Texas are kept off limits by Federal regulators. With reports coming out that gasoline could approach five dollars a gallon by this summer, we cannot wait any longer to begin tapping these resources.”
If the Obama administration really wanted to create jobs and improve the economy, it would “lift the embargo on American energy,” said Kish, “and open our onshore and offshore resources for robust exploration and development.”
“The U.S. Geological Survey estimates that the nation has six times the proven oil reserves of Saudi Arabia”
In 2010, while oil, natural gas and coal accounted for 78 percent of U.S. energy production, its producers received 11 percent of all federal energy subsidies. By contrast, subsidies to the wind industry increased 10-fold, from $467 million in 2007 to $4.9 billion in 2010.
Closer to the pump for Americans was the deal the Obama administration struck with thirteen auto manufacturers in July 2011 to boost new car fuel economy standards from 35.5 miles per gallon (mpg) in 2016 to 54.5 mpg in 2025.
The claim made was that it would save Americans $1.7 trillion over the lifetime of vehicles and $8,000 per vehicle by 2025. Higher gas prices as the result of increased costs of imported oil and higher automobile prices that will result from this deal will cancel out any alleged savings.
Who wants to be fooled again by this administration?
And what business is it of the federal government how much mileage an auto gets?
The U.S. government has been messing around with the fuel economy program—believe it or not—for forty years. The result was the rise in sales of Japanese auto companies and European imports while Detroit saw General Motors and Chrysler come so close to collapse they had to be bailed out with billions of taxpayer dollars.
The culprit has been the Corporate Average Fuel Economy program and Marlo Lewis of the Competitive Enterprise Institute calls it “a case study of unintended consequences. If the fuel-saving technologies requisite to meet the new standards are such a great bargain, why do we need a law forcing automakers to adopt them?” Good question!
Both the Environmental Protection Agency and the Department of Transportation crowed that “Today’s announcement is the latest in a series of executive actions the Obama administration is taking to strengthen the economy and move the country forward because we can’t wait for Congressional Republicans to act.” That’s right, they blamed by-passing Congress and the deal on Republicans!
Meanwhile, the only thing CAFE standards accomplish is an increase in the cost of automobiles and a decrease in the safety of their occupants as cars are forced to be lighter and more vulnerable in a crash.
Opening the Arctic National Wildlife Reserve (ANWR) to oil exploration and production would have obvious benefits. “This legislation opens 400,000 acres of the ANWR coastal plain’s 1.5 million acres” that represent “less than three percent of ANWR’s 19 million total acres.”
The other way Americans have been forced to pay more at the pump have been the mandates for the mix of ethanol in every gallon of gasoline. Why? Because its advocates claimed that this would reduce carbon dioxide (CO2) emissions, but in fact ethanol increases CO2 emissions while at the same time reducing the mileage of every gallon of gasoline. And there is absolutely no scientific justification for reducing CO2 emissions because the mandate is based on the totally debunked global warming hoax.
The cost of building new oil refineries in America was increased exponentially by the Clean Air Act of 1970. There have been no new refineries since 1976. There are currently 149 refineries in the U.S. Requiring them to make different blends for different regions of the nation has done little more than to drive up the cost at the pump. The taxes on gasoline have been a bonanza for the federal government and the states.
The good news is that two new refineries are being developed, one in Yuma, Arizona, and one in Union County, South Dakota. The bad news is that Sunoco Inc has just announced it will continue to exit the refining business due to the lack of profitability. In business for 117 years, Sunoco has been gradually shifting out of refining, reducing its capacity 43 percent since 2009.
Come November, if drivers of cars are shelling out $5 a gallon at the pump, a lot of voters are going to be very unhappy. If our citizens are still being held hostage in Egypt they will be even less happy.
© Alan Caruba, 2012
3 comments:
Since carbon dioxide is absolutely required for green plants to grow, and more of it would increase agricultural output and all other green plant growth (green plants are the base for the food of all other life on the planet) it is absolutely stupid to listen to the garbage these "save the planet" uneducated fools say, since if carbon dioxide was actually reduced significantly, all life on Planet Earth would be dying off.
Obama has openly admitted he wants to see gasoline prices rise to $5 or $6 a gallon (but more gradually). I always say, "follow the money". I would bet any amount that the people pushing the 'green' agenda have tons of money invested and one way or another, they are going to make it pay off.
Democrat legislators who are beholden to whack-job environmental nazies will continue to block drilling, refining, and mining initiatives to create an artificial shortage of fossil fuels which will obviously drive the price up. Wind, solar, geo-thermal, or whatever other 'green' energy that can be named is not econonically justifiable as an alternative at today's oil and gas prices. They offer no real return on investment and in fact create capital losses of monumental proportion to those who try it. No real entrepreneur with even a smidgeon of business sense would invest a dime in it.
But when the government throws trillions of OUR dollars at it in the form of grants, loan guarantees, or tax credits, one seedy outfit after another crawls out of the woodwork to get a piece of the action. They take the money and go through the motions of running a business but when they have to meet real obligations like payroll and production costs, they soon go belly up, leaving us 'stupid' taxpayers with the bill. (I say stupid, because if we were smart, we would be screaming for heads to roll starting with the big head in the oval office).
The truth is that when oil goes to $200-$300 a barrel and gasoline gets to $6, $7, or $8 a gallon, and most of the coal mines are shut down, then and only then, will all these 'green' pipedreams start looking economically feasible and become a good investment. The Democrats in congress (backed with money from rar-left crazies) will ensure that it happens by retaining legislative and/or executive power and voting against any form of fossil energy. They are expecting pay dirt from their wind turbines and solar panels.
There is absolutely big money at the bottom of this sewer for the Al Gore faithful. Why else would decisions coming from Democrats in Washington fly in the face of the sane, rational, and logical reasoning of a majority (65%-70%) of Americans?
Obama has openly admitted he wants to see gasoline prices rise to $5 or $6 a gallon (but more gradually). I always say, "follow the money". I would bet any amount that the people pushing the 'green' agenda have tons of money invested and one way or another, they are going to make it pay off.
Democrat legislators who are beholden to whack-job environmental nazies will continue to block drilling, refining, and mining initiatives to create an artificial shortage of fossil fuels which will obviously cause the price to go up. Wind power, solar, geo-thermal, or whatever other 'green' energy that can be named is not econonically justified on paper. It offers no return on investment and in fact creates capital lossses of monumental proportions to those who try it. No capitalist with a smidgeon of brain would invest a dime in it.
But, when the government throws trillions of dollars at it in the form of grants, loan guarantees, or tax credits, one seedy outfit after another crawls out of the woodwork to get a piece of the action. They take the money and go through the motions of running a business but when they have to meet real obligations like payroll and production costs, they soon go belly up, leaving us 'stupid' taxpayers with the bill. (I say stupid, because if we were smart, we would be screaming for heads to roll).
The truth is that when gasoline gets to $6, $7, or $8 a gallon, then and only then, will all these 'green' pipedreams start looking economically feasible and become a good investment. The Democrats and far-left crazies will ensure that it happens with their money and votes. They are expecting a big pay day.
There is absolutely big money at the bottom of this sewer for the Al Gore faithful. Why else would decisions coming from Democrats in Washington fly in the face of the sane, rational, and logical reasoning of a majority (65%-70%) of Americans?
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