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Catching up with Conservatism: Obama’s Gas Prices and Hypocrisy

By
March 22, 2012

You could go days without spotting a car here in the lush, pedestrian society of Swarthmore. But the general consensus is that automobiles in the rest of America are thirsting for affordable gas.

There’s nothing like a fuel fiasco to get Americans ignited against Washington. President Barack Obama, having nixed the Keystone Pipeline and campaigned endlessly on “green” energy back in the pre-Solyndra days, is feeling the heat. Like any good test-taker, the President is advocating an “all-of-the above” energy strategy. Unfortunately, this approach has avoided licensing drilling on public lands in the broader Gulf of Mexico, Floridian coast, Mid-Atlantic, Rockies, and elsewhere. Meanwhile, Energy Czar Chu is on record for famously championing $10 a gallon gas prices to dry up demand and launch the 2008 green energy bonanza. Obama himself once wished energy would “skyrocket” and has never refuted or re-articulated these remarks.

According to the U.S. Energy Information Administration, prices are now averaging $3.84 a gallon nationwide. The White House, scrambling to control the spin on this engine, insists that one guy in the Oval Office has very little impact on gas prices. Simply opening up drilling, advisors say, would do decidedly little for the world market. While it’s true that the President cannot directly wave a magic wand, it is disingenuous for the executive to assume vast control over other macroeconomic sectors, like regulating banking and overhauling health care, and then plead innocent when it comes to energy. After all, this is the same Administration which takes credit for any and all upticks in aggregate employment numbers. If Washington were a smaller, humbler city, the President wouldn’t be responsible. Yet, if you’re going to concentrate ever-greater political power into the national government, you must be geared up for the political petrol that follows. Our monolithic debt and deficits have systematically devalued the American dollar and made energy exchange more expensive. The President’s hands aren’t clean.  Moreover, if increasing oil supply through domestic drilling (which is safer and cleaner than production in Venezuela or Russia) would have no effect on prices, as the Administration reports, why has the President pressured the Saudis to boost their petroleum exports? Do supplies in the Middle East flow into the global market more healthily than Texan rigs?

Circling back from his energy tour through Nevada, New Mexico, Oklahoma and Ohio to champion U.S. energy investments, the President keeps repeating that energy production has increased during his tenure. Although this is technically true, these projects were by and large okayed by Presidents Clinton and Bush, not Obama. It’s not very gentlemanly to slam your predecessor in every news conference, and then take credit for his drilling when solar panels stop hypnotizing voters. And it’s drilling on private lands that’s fed most of the increase. Petroleum from public lands, which requires federal approval, actually fell by 13 percent in 2011.  In one breath, the President praises the new petroleum pipeline in Cushing, OK and takes credit for giving it the go-ahead. The only problem with this photo-op is that the President rejected Keystone XL, which would have extended this same pipeline Northward, and the new pipeline that is underway didn’t need Obama’s authorization. If this energy passe were a matter of President Obama being a concerned steward of the earth,  I’d disagree with him about policy but offer respect. However, you can’t quash a pipeline to please the Sierra Club and then expect Oklahomans to join you in celebrating the wonders of that same truncated pipe. This is slick campaigning indeed.

As a matter of political truth-speak, I’m tired of hearing about “subsidies” for oil companies. You’d be excused, based on the stump speeches, for picturing Shell and BP guzzling our tax dollars for their greasy purposes. Yes, oil companies benefit from manufacturing breaks, provisions written into the tax code for all manufacturers–oil corporation, windmill factory or otherwise. If the thought of Exxon receiving a tax-break gives you ajada, cleanse the tax law of special interests. I would gladly support a simplified, shrunken tax code, but if the manufacturing provision exists, surely oil companies meet the criteria. To arbitrarily cancel tax credits for some while watering the now-bankrupt Solyndra with “stimulus” amounts to the very same “winners and losers” game the President regularly scorns. The general justification for the government-green alliance has been that the initial investment is too astronomical for start-ups to fund on their own. But many industries are expensive out of the gate. There’s no government boost for airline investments, shipping, or hotels. With petroleum prices so volatile, oil companies themselves are rethinking their business models. As admirable as green legislating may be, it dangerously distorts price signals and builds elaborate wind farms that no utility will buy.

To be clear, I pray there will be a day very soon when safe, cheap, and domestic alternative energy charges America. I would love to drive a Chevy Volt that doesn’t catch on fire. But innovation and start-up energy investments is not in the job description of the President. Maybe algae really is the Second Energy Coming–but let’s leave that to the entrepreneurs.

15 Responses to Catching up with Conservatism: Obama’s Gas Prices and Hypocrisy

  1. Jae Reply

    March 22, 2012 at 11:34 pm

    While I concede that you make good points concerning the administrations stance and energy and calling them on their hypocracy, the same can also be said of your article. Conservatives like yourself always trumpet the horn of the free market, yet you call out the president for not using the same big government powers that always gets called “Socialist” whenever the government interferes with the market. Why not just accept that gas prices are controlled by supply and demand?

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  2. Joseph Picopo Reply

    March 22, 2012 at 11:43 pm

    President Obama is correct – more drilling will NOT reduce fuel prices, due to the increasing share of demand from overseas consumers. “More drilling” is the mantra of the oil lobby and anti-obama voters unwilling to advance the U.S.A. beyond dependence on fossil fuels!

    Take the pain and get off of oil, before the economy totally collapses.

    JP

    Hot debate. What do you think? Thumb up 10 Thumb down 8

    • Translation Party Reply

      March 23, 2012 at 1:17 am

      Cut the fuel consumer prices abroad, Obama President. Vote for digging from Obama fossil fuel resistance mantra front lobby! Before oil and close the complete agreement of economic pain.

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      • The Human Microphone Reply

        March 23, 2012 at 1:31 am

        CUT THE FUEL CONSUMER PRICES ABROAD, OBAMA PRESIDENT.

        Recommended by readers. Vote Up or Down: Thumb up 8 Thumb down 0

  3. Susana Reply

    March 23, 2012 at 9:48 am

    GAS PRICES ARE LOW, PEOPLE.

    Gas in oil-rich countries in the middle east and venezuela may literally pay pennies compared to us, but when you look at prices in europe which are DOUBLE what we pay, you have to wonder, are we just too squeamish to handle the market price?

    (Admittedly, gas in Europe is heavily taxed to pay for investment projects, but still, gas at the pump in Brazil, India, Turkey, Japan, are all a dollar to 5 dollars more expensive)

    HIGER GAS PRICES WOULD REDUCE OUR DEPENDENCY. It would incentivize our nation’s engineers to build better, more cost-effective green technology, incentivize people to economize at the pump, and would ultimately move our nation towards self-sufficiency.

    I’m not talking about Europe’s $8/gallon insanity. I’m talking about a slow, planned uptick to allow for healthy accommodation. Perhaps this is not something to be done at the tail end of a recession, and certainly it is not the popular thing to do, but it is a LONG-TERM outlook. When oil is even scarcer in the next 50 yrs, the US–which is not a significant oil producer, no matter how much we drill our Alaskan Wildlife–should not be caught with its pants down.

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  4. hizzle Reply

    March 23, 2012 at 10:03 am

    The reason Solyndra is bankrupt is because most Americans do not qualify to work for a company in that category: requirements of proficiency in science, maintenance, and tech/computer skills are NOT being met by sixty percent of Americans.

    That’s a serious problem. When we realize our population is not educated enough to work for companies that might save the goddamn planet, so we fall back on oil drilling.

    By the way, I’m sure a good portion of the Tea Party are workers or manufacturers who live off of subsidies by the government. They don’t pay much in terms of taxes. So calling for a simplified tax code by these people along with congress members who make hundreds of thousands a year makes no damn sense and should be looked at with a critical eye.

    Thumb up 2 Thumb down 4

  5. William Reply

    March 23, 2012 at 4:31 pm

    @hizzle: If that reason works for you fine. I think it’s more likely the price of silicone dropped and competitors’ products become more affordable. The failure is an indication of why the government isn’t the best entity to be investing in markets where a winner or loser has to be chosen.

    Thumb up 2 Thumb down 0

    • Translation Party Reply

      March 24, 2012 at 11:32 am

      This is an affordable, great movie… Why is this silicon and competitive price. Market Government fault symptom selection winner loser entity best investment.

      Thumb up 3 Thumb down 0

  6. anon Reply

    March 23, 2012 at 6:33 pm

    Solyndra’s problem was price, not worker shortage/education.

    Solyndra was building solar products that cost 4 times as much as others in the market. It didn’t sell too many.

    The DOE guaranteed Solyndra loans. But could not overturn basic laws of economics. Taxpayers lost.

    Another example: “Government backed loans” also has California’s PERS pension system facing huge losses.

    PERS guaranteed loans for real estate developers. Risky real estate deals were picked. (Apparently based on close personal connections and finder fees paid to PERS directors, more than anything else.) The deals went belly-up. PERS ended up on the hook for the losses. PERS is now under-funded by half a trillion dollars, give or take.

    Again, taxpayers lost.

    Are you seeing a pattern yet?

    Government bureaucrats fail to realize that, ultimately, the economics of a lemonade stand apply to every business. The numbers just have a lot more zeros.

    Thumb up 5 Thumb down 2

  7. oil spills Reply

    March 27, 2012 at 3:26 pm

    Because drilling in the gulf is always a net positive, amiright?

    Thumb up 3 Thumb down 1

    • truth Reply

      March 27, 2012 at 8:59 pm

      or off the coast of Nigeria! Nothing bad could possibly happen.

      Thumb up 2 Thumb down 1

  8. Not even a smart kid Reply

    April 6, 2012 at 12:04 am

    http://www.bloomberg.com/news/2012-02-29/u-s-was-net-oil-product-exporter-in-2011.html
    The United States is a net exporter of all oil products, including gasoline. This implies, very naturally and logically, that we produce more oil than we need. If we produce more gasoline than we need, why do we need to drill for more? Gas prices rose even though we here in the United States are at excess capacity. Pray tell, how do you expect more drilling to accomplish anything? It seems ikely any oil added to the supply will find its way to a foreign country.

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  10. crystals Reply

    November 8, 2012 at 4:55 pm

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  11. Andrew Karas Reply

    February 21, 2013 at 10:12 pm

    Hi Veola,

    Thanks for the compliments! As for daily notifications, we publish several articles almost every Monday-Friday–an email sendout occurs at 5:00am. You’ll see a “Subscribe to the Daily Gazette” link at the top of our home page. We also post most of our articles on Facebook (like The Daily Gazette) and Twitter (follow @swatgazette).

    Andrew Karas ’15
    News Editor

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