In the interest of full disclosure, I would emphatically state that.as with other companies, I'm sure the oil companies are no less pleased with any profits that they are able to make at the end of the day than any other company attempting to survive in a "redistribution" of wealth system. Oil stocks are obviously and perhaps in the opinion of some, even obscenely benefiting from the world price of oil. The shareholders must love it. I'm sure Al Gore's family holdings in Occidental Petroleum must be paying off very nicely for him. Did I say that? Can I say that? I envy him. I don't begrudge Al Gore a nickel of his $100 + million dollar worth. What I do take offense to is the fact that he and other Liberals who have become filthy rich while prospering under thriving American Capitalism think that it's OK for them to become filthy rich, it's jus
t not ok with them if YOU do.
Many years ago, our liberal Congress and the environmentalist lobby began their crusade to make it certain that we would have no avenues to becoming energy independent. I'll explain more of that below.
Let's put some facts on the table. The price of oil is set by a combination of speculators and investors on the world market, a healthy dose of supply and demand, the cheaper dollar, quotas being pumped by our Arab and South American "friends" who know that our own internal exploration hands are tied, and huge, rising (and will continue to rise) consumption and demand levels by China and India. $4 to $5 a gallon gas prices are here, but they don't have to be here to stay. We've been dumbed down by the media to the point of rejoicing when they report that gas has gone down $.05 a gallon to $3.95 when it should actually be closer to the $1.80 that it was when President Obama took office. Punishing the oil companies by further taxing them beyond their current tax rate of 44% or so is not going to fix that. The oil companies are already among the most highly regulated, controlled and taxed entities in the world. The chant that all of the current oil woes are the fault of the oil companies and George Bush in particular is one of those mantras that proves the old saying that if you repeat something often enough, and with enough conviction, more and more people come to accept it as truth. If you were to research the facts of what exactly the oil companies *can* do, you will find that in truth American oil companies can not even breathe without government approval.
So.....what do oil companies do, or rather, given the nature of their business, what would they most *like* to do?
Well, their lifeblood is ...surprise, surprise.....drilling for oil!! New sources of oil. They are practically BEGGING the government to issue drilling permits. The Obama Administration however is not very interested. Even though Obama himself is running all over the country telling everyone that permit numbers and drilling are both up under his leadership, what he conveniently neglects to tell the enthralled is that almost every one of those permits were issued before he took office, during the Bush Presidency and some even during the Clinton Presidency. In addition, almost all the currently issued permits are on private lands. A recent Energy Information Administration (EIA) report revealed a 12-percent decline in production for coal, oil, and natural gas on federal and Indian lands from fiscal 2003 through fiscal 2011, its lowest point in nine years. Yet during that same time frame, production on state and private lands has increased, boosting overall production numbers for the United States. While oil and gas production is up in the United States on private and state land, it is down on federal land, which falls under President Obama's direction. Petroleum from those public lands actually fell by 13 percent during 2011.
Now for some of the steps he is taking to shut down, rather than open up our own resources and path to energy independence. Nick Loris from the Heritage Foundation outlines four steps Obama has taken to limit U.S. oil production:
Withdrew areas offered for 77 oil and gas leases in Utah that could cost American taxpayers millions in lost lease bids, production royalties, new jobs and the energy needed to offset rising imports of oil and natural gas.
Cancelled lease sales in the Western Gulf of Mexico, the Atlantic coast and delayed exploration off the coast of Alaska and kept other resource-rich areas off-limits.
Finalized rules, first announced by Secretary Salazar on January 6, 2010, to establish more government hurdles to onshore oil and natural gas production on federal lands.
Withdrew 61 oil and natural gas leases in Montana as part of a lawsuit settlement over climate change.
Obama's Energy "Czar" Steven Chu is on record for calling for $10 a gallon gas as necessary to bring us into line with European prices and send us scrambling for our rickshaws....and President Obama himself pointed out just a few days ago that he had opened up a small area of the Alaskan Coast while neglecting to mention that the area offered for exploration is already so depleted of oil that he can't find a taker for the permits. Not to worry however. We have more "green" jobless Solyndra-like projects given to political cronies and corporatist pals who support Obama in the works for the American taxpayer to bail out when they crumble. This while his pals on the board get multimillion dollar bonuses. The Keystone Pipeline has also been rubbed in the face of our close ally, Canada. That project would have brought tens of thousands of jobs and lower energy prices to our country.
President Obama criss crosses the country almost daily giving politically popular speeches about supporting the little guy and taking away those huge "subsidies" to the oil companies. The tone of his speeches seems to imply that the American taxpayer is opening up his / her wallet and giving money to the already rich oil companies. What he neglects once again to tell is....the truth. When a company is doing business, over the years they can take a depreciation against old machinery, equipment, furniture, etc and write it down on their taxes. What the oil companies get is exactly that, but in their case it is called "depletion" allowance. As wells over the years begin to dry up and the equipment becomes aged, they are allowed to depreciate its value. Just like any other company in America. No different. That is what Obama is calling a "subsidy". Furthermore, NO MAJOR OIL COMPANY since about 1976 has been allowed to take this depreciation allowance. Congress revoked that privilege right after the oil crisis of the 1970's. The only oil companies in modern times who can take this deduction are the small, independent companies. The very companies that innovate, provide jobs, and help to spur the economy. So rather than fighting for the "little guy", President Obama is once again putting the little guy up against the wall while the media in this country feeds the public his very popular "subsidy" line. He knows it plays well with the public and with environmentalists, and it's easy to present the picture of David versus Goliath. But once again, I digress! We need to go back to what I said above about leaving us no avenues to energy independence.
Why then, you say, can we not ease our current painful situation and drill for and refine our own plentiful reserves while at the same time having the oil companies and private corporations further research alternative fuels so that we might transition over to new forms of energy in the future? Sanely move to these new technologies and make them affordable while gaining energy independence today? Our Anwr range in Alaska, our interior States and our offshore deposits of oil and natural gas are huge indeed and could offer short and longer term relief from dependence on our Arab devil slave masters while we have the elbow room to move America forward in other areas and build a bridge to alternative energy. But we have taken that option along with our energy independence, off the table. (See Keystone Pipeline, for example)
We don't drill in Anwr and our offshore fields because the Administration and the environmentalist lobby won't allow it. It's that simple.
Well, ok...what to do...what to do....we can't drill. I know, it makes no sense, oil companies WANT to drill, we won't let them Well ok then...hey, I've got it! America has HUGE reserves and deposits of coal. Best of all, clean coal burning technologies already exist! 45% of all the U.S. power that is generated comes from coal fired plants! We have enough for HUNDREDS of years! We could mine that and use that to....ooops....no, sorry, the environmentalists won't let us do that either. Umm......No....no coal burning for us. And over 30 coal fired power plants that supply millions of homes are closing in the next few years because of new EPA stringent regulations issued by un-elected paper pushers. Eventually, this will of course mean fewer jobs, more blackouts...and higher electric bills! Check out the cost of your electric bill over the past 2 years. I know mine has gone up just this past year about 15%...and it's still rising. And worst of all....where are you going to plug that $40K Chevy Volt into a charger? And what will *that* cost? But I digress again, that's another disaster for another discussion.
Ok....I've got another good idea. Let's build more refineries so that the oil companies can process oil into gas more efficiently and cheaply and at a much higher rate. Ooooops...sorry, we can't do that because we haven't built a new refinery of any significance in 30 years due to EPA regulations. Not that the oil companies haven't applied and asked to do so, but when they do we make them jump through so many hoops that are so far beyond reasonable that it is just a money losing proposition for them. Nope, no more refineries.
Wait....all is not lost. Even though the French take a bum rap in the press, we don't hear them complaining nearly as loudly as others because in fact over 94% of their internal energy needs come from clean burning Nuclear power plants. We can....oh, damn...damn, damn, no we can't because the environmentalists and Congress won't let us build nuclear plants either.
Ahhhh....corn. beautiful corn. We have so much of it that we can turn it into ethanol and then.....wait a minute...all of a sudden that industry isn't as rosy as the environmentalists said it would be....ethanol has problems and drawbacks, its very expensive, and now the blame America first crowd is jumping on us for helping to create a world food shortage by diverting corn production to ethanol....we just can't win, can we?
We're stuck in a corner and we have allowed the spineless politicians on both sides of the aisle and the environmental lobby to put us there. This of course makes people very angry. This entire situation just HAS to be *someone's* fault.....but of course!!! How could I be so blind? All of this is the fault of the oil companies!!! Or George Bush! Or anyone at all actually except Obama. He's not very good at taking credit for anything at all unless it's the smallest bit of good news. Under Obama, everything that should be going up......is going down....and vice-verse.
On another note, I do have a "ponderance" of my own, to use a phrase that I heard used a few days ago. While the liberals scream about oil company profits and point to those billions of dollars that they are raking in, they always conveniently overlook the fact that: 1:) Those figures are usually quoted in pre-tax profits. The oil companies currently pay an astounding 44% (give or take a percent or two) tax rate on their profits. And.....2) Think about it.....who stands to make the biggest profit on high gas prices? Let's see...the oil companies make about $.04 cents per gallon of gas in profit but someone else is making about $.48 cents a gallon profit. That would be the GOVERNMENT. Talk about so-called "windfall profits"!
The truth is, those huge tax dollars that the oil companies must pay are being used for more social programs and pet projects of an overspending, over regulating, continually tax raising, out of control Federal Government. The Democrats love taxing and spending, it gets them elected by promising the public that government will solve all of their problems and take care of them from cradle to grave, (and it's working, incidentally) and many of the Republicans who should know better always vote to cut the taxes but then spend almost as obscenely as their friends on the other side of the aisle, not daring to cut that spending for fear of political suicide.
There's got to be an angle here somewhere. After all, we can't possibly blame ourselves and those we elect again and agaiin for this, can we? Somehow this just has GOT to be George Bush's fault. Or Wall Street. Or the oil companies. Or could it possibly be the fault of the government boot on our necks that continually holds American exceptionalism and capitalism down to the point of strangulation?
It's not capitalism that is the enemy here. It's crony corporatism. Grab your Chevy Volt. Just don't forget to bring your fire extinguisher.