Category Archives: Energy

Updated: Energy Independence Isolationism

Economy, Energy, Environmentalism & Animal Rights, Free Markets

About “oil independence,” I wrote the following in September of last year:

“I can never understand the protectionist, bellyaching about oil independence. Has anyone heard of trade? Perhaps if we traded more with Iran, instead of boycotting its wares, Iranians would be less belligerent. Trade is the best antidote to war. Think clearly: Iran has to sell its oil. That’s its livelihood. We need to buy it. Voila! Trade! Oil independence is a foolish leftist notion. Do I grow carrots in my backyard so as to become less dependent on Costco? Why would I? Costco needs to sell its fabulous produce; I want to buy it. Case closed.”

About the fallacy and fundamental dishonesty of “energy independence,” Bill Anderson writes this:

“There is something reassuring about the concept of ‘energy independence,’ but the term is much more dishonest than one might think. First, and most important, the United States is part of a world economy, and it is not the case that because one product is produced within the borders of this country the United States is “independent” of what happens elsewhere in the world. Indeed, many people who call for “energy independence” have no problem in calling for U.S. troops to be sent around the world for military operations because they insist that global issues are our issues, too. (My comments are not an endorsement of such policies, but rather an attempt to point out that people who call for energy independence need to be consistent in their thinking.)

Second, one must remember that trade itself is by nature a peaceful activity, spurred on by mutual benefits to all parties involved. It is in Americans’ interest to trade with all nations, including those in the Middle East. Before the Gulf War of 1991, the United States was trading peacefully with Iraq and other nations of the region. The turmoil in Iraq-U.S. relations was more the result of U.S. policies than anything hatched by the late Saddam Hussein, as cruel and dictatorial a person as he was. Furthermore, even if this country could theoretically produce all necessary fuel domestically, the cost to taxpayers and consumers would be extremely high and would greatly lower Americans’ standard of living and increase the rate of poverty here.

Energy ‘independence’ is a foolish term that has no bearing in reality. Such a regime of “independence” would require government to expand its powers of taxation and regulation far beyond where those powers operate today, and Americans would be made substantially poorer for the effort.

There is another way. The United States could return to being a peaceful trading partner with countries of the world, no matter what the ideology of their governments. In the long run, there would be no call for ‘energy independence,’ because trade obviously would be the better and wiser route to take.”

If you haven’t yet, do read “The Goods On Gas.”

Update (June 22): COMPARATIVE ADVANTAGE. When I see my frugal, time-deprived husband change the oil in his car, I begin talking about comparative advantage. Yes, in addition to the highly specialized work he does, the man is more than able to do most things around the house. However, how viable is that? The time he devotes to the oil change could have been better utilized to do more lucrative work. Or to play the guitar, also the second greatest love of his life. (We hope)

The idea of trade is that everyone does what he is best and most efficient at, and exchanges the products of that labor for stuff others do better and cheaper. To aim for self-sufficiency is to aim for bankruptcy. The Saudis are good at getting oil out of the ground. Their installations showcase magnificent high-tech equipment. Thanks to the environmental ideologues the US is run—and overrun—by, we’ve fallen by the way. So now we want to stop trading?

According to CNN:
“America now uses nearly 21 million barrels of oil a day, a quarter of total world consumption. It imports nearly 60 percent of it. Domestic production has been falling for 35 years.”

Importing what we need is good. But halting production for political reasons is not.

Speaking of the best of technology: Did anyone see the CNN and interviews with Anadarko Petroleum? If only the f-ck-faces in Congress left it up to companies like this and their teams of geologists and engineers, we’d have oodles of gas in no time.

On one of their many rigs drilling goes on thirty-three thousand feet–six miles down. On the day the CNN correspondent visited, they were “down 11,000 feet, two miles below the ship.” That’s astonishing.

Anadarko Petroleum has

“Remotely operated vehicles, or ROVs, [that] reveal what is happening on the sea floor. Global positioning systems and thrusters underneath the ship keep it in place over the wellhead. Computerized lifts pull pipe 270 feet at a time with nothing more than the flick of a wrist.”
“The ship and crew cost nearly $300,000 a day, each deep water site [is] a huge gamble, hundreds of millions for what could be a dry hole.”

These vilified companies are incredible. Read the transcripts here for more about the wherewithal of one of our oil companies. If only the putrid politicians and their gangrenous pals would let the likes of Anadarko Petroleum do what they do best. Take care of business.

On the other hand, if I were being called every other day to face the congressional cockroaches, so as to satisfy the pitchfork-wielding folks, I’d do an Atlas Shrugged. Liquidate, sell, get out of the business.

The Goods On Gas

Capitalism, Energy, Free Markets, The State

From my latest WND column, “The Goods On Gas”:

“The Mouths on television tell you to blame gas speculators, ‘profiteers’ or foreign producers for gas prices—anyone but your government. By their post hoc illogic, the price of fuel is causing prices to rise.

Fuel is fueling, but not causing, price hikes.

The deliberate and destructive policies of deficit spending are responsible for the steady rise in the prices of all commodities, crude included. This is so because deficit spending is “accompanied by an enormous increase in the stock of money…”

The general trend, then, of price increases is a consequence of government-generated inflation and the $9.5 trillion trifle known as the national debt. Unless these are curtailed, the trend will persist.

The particular price of fuel, concomitantly, is determined by supply and demand. … Absent legislative barriers to exploration, enterprising capitalists would have defied central planners and turned from tinkering with ethanol to drilling for—and refining—oil…”

Ultimately, “The more efficient the source of energy, the less waste and pollution are involved in its conversion into energy. Think of the totality of the production process! The fewer resources expended in bringing a fuel to market, the cleaner and cheaper is the process.”

Comments are welcome.

A Bright Woman on Cable?!! Oh My G-d!

Economy, Energy, Gender, John McCain, Media

What is a bright woman doing on one of the Cretins Inc. channels?

That was my reaction when I heard Carly Fiorina explain economics 101 to a dumbstruck Wolf Blitzer of CNN.

At first I did not recognize the controversial former CEO of Hewlett-Packard. All I heard were the intelligent, measure words of a woman who thoroughly understood the effects of taxation on oil supply. Fiorina was telling Blitzer that by taxing the oil companies’ profits, the brilliant Obama will bring about less oil production and higher prices. (I recommend Obama begin his education with Henry Hazlitt’s Economics in One Lesson.)

Fiorina is advising John McCain. Good choice.

The reason for my surprised reaction is that cable is a disgrace. The unprepossessing front men and women, seldom the brightest, surround themselves with beaus and bimbos a little less bright than they. All are happy; none is threatened. And Booboos Americanus remains blissfully unaware that the bobbing heads on TV are not the country’s crème de la crème.

Blasting Big Oil

Democrats, Economy, Energy, Environmentalism & Animal Rights

Another front on which “conservatives” have joined forces with the Democratic berserkers is in placing the blame for gas prices on the oil companies. Not on government, God forbid—it has spent us into oblivion, causing the dollar’s devaluation, and, consequently, the prices of all commodities to rise. No sirree. Like Obama and Clinton, dittoheads lay in to “Big Oil.”

Do me a favor; leave off that bogus bugbear.

Exxon Mobil and the rest have done a smashing job of bringing a product to market despite the fact that they’ve not been allowed to build a refinery for 25 years. Who has outlawed drilling in the arctic tundra or off the coast of California and Florida?

Not one nuclear power plant has been constructed since Three Mile Island. That’s due to the energetic efforts of your government and the environmental antediluvian interests it heeds. But chiefly government. Why? Because it has a duty to say “no” to the anti-civilization lobby. (McCain is a pinko to rival all pinkos when it comes to understanding energy.)

To the list of our government’s energy infractions, Pat Buchanan, in Day of Reckoning, adds the tearing down of “great dams like Hoover and Grand Coulee.”

Reduced supply and increased demand means higher prices. Cheer a Democrat-led attack on oil companies and you’ll be penalizing their ability to bring gas to market. Lines around the block will ensue.

Writing in the New York Times, Ben Stein deconstructed the “Us vs. Them” myth of oil ownership, also a component in the demonization of “Big Oil”:

“First, Exxon Mobil, like all the other gigantic integrated energy companies in this country, is owned not by a cabal of reactionary businessmen holding clandestine meetings in a lodge in the Texas scrublands (as Oliver Stone so brilliantly illustrated in “Nixon”).

Exxon Mobil, in fact, is owned mostly by ordinary Americans. Mutual funds, index funds and pension funds (including union pension funds) own about 52 percent of Exxon Mobil’s shares. Individual shareholders, about two million or so, own almost all the rest. The pooh-bahs who run Exxon own less than 1 percent of the company.

When Exxon Mobil earns almost $12 billion in a quarter, or $41 billion in a year, as it did in 2007, that money does not go into the coffers of a few billionaire executives quaffing Champagne in Texas. It goes into the pension and retirement accounts of ordinary citizens. When Exxon pays a dividend, that money goes to pay for the mortgages and oxygen tanks and in-home care of lots of elderly Americans.

So, Mr. Obama, which union pension plans — and which blue-collar workers who benefit from them — will be among the first you would like to deprive of the income that flows from Exxon’s rich dividends?

When Mr. Obama or his Democratic rival, my fellow Yale Law School graduate Hillary Rodham Clinton, go after the oil companies and want to take away their profits, they are basically seeking to lower the income of the ordinary American. Why do that? It’s just cutting off one end of a blanket and sewing it to the other.”