Folks in Washington have trying to make political hay out of the rising gas prices, and understandably so, but it makes you wonder "Who's fault is it really?"
Does the blame lay at the feet of the oil producing countries? Economic conditions beyond our control? Our inability to ween ourselves off oil? Politicians who line their pockets with oil company money and then protect their interests over the American people's?
In the end, I think it's a combination of all of these factors, but it's the last one that really bothers me.
The Big Oil companies -- you know the one's that Pat Roberts is so dedicated to protecting -- would have you think their record profits are due to rising costs of doing business.
Anyone who has taken a basic economics class should be perplexed by this statement. The issue isn't that they've seen an increased revenue, which could be plausibly explained by an increase in costs. The issue is they have seen an increase in profit, which means either the increase in cost argument is crap or they have increased the price they charge disproportionately.
But curiously, when President Bush spoke at the rose garden yesterday, he addressed just about everything other than the activities of the major oil companies.
I've repeatedly submitted proposals to help address these problems. Yet time after time, Congress chose to block them. One of the main reasons for high gas prices is that global oil production is not keeping up with growing demand. Members of Congress have been vocal about foreign governments increasing their oil production; yet Congress has been just as vocal in opposition to efforts to expand our production here at home.
OK, fair enough. Demand is growing faster than supply. Can't argue with you here. But there are two ways to curtail that problem. Bush seems obsessed with increasing supply, which in theory would solve the problem. But where is the call to decrease demand? Oh right, that's the thing that's been in all your State of the Union speeches but you never actually did anything about.
They repeatedly blocked environmentally safe exploration in ANWR. The Department of Energy estimates that ANWR could allow America to produce about a million additional barrels of oil every day, which translates to about 27 millions of gallons of gasoline and diesel every day. That would be about a 20-percent increase of oil -- crude oil production over U.S. levels, and it would likely mean lower gas prices. And yet such efforts to explore in ANWR have been consistently blocked.
OK, other than "environmentally safe" drilling in ANWR, what exactly have you proposed to solve any of the problems you mentioned, Mr. President? BTW, ANWR doesn't have enough oil, environmentally safe or not, to have any positive impact on oil prices, but thanks for playing.
Another reason for high gas prices is the lack of refining capacity. It's been more than 30 years since America built its last new refinery. Yet in this area, too, Congress has repeatedly blocked efforts to expand capacity and build more refineries.This one really gets me.
If a junky is addicted to heroin. All of a sudden heroin prices start skyrocketing. He comes to you and says "Hey man, I need some smack but I don't have a job and prices are a real bitch lately." You don't say, "You know what dude, if you started making your own heroin, you could put it in the market and drastically increase supply while demand stays relatively constant, then you could get your fix at a more reasonable price." You say, "Hey man, let's get you some help so you don't need heroin anymore."
Once again, all of Bush's proposals involve using more oil. He gives passing references to things like ethanol, but the solution to the energy problem in our country and in our world cannot be a band-aid approach. It has to be a wholesale change in our policy outlook.
You don't have to be a tree-hugger to realize that, one of these days, we're going to run out of oil. Obviously, this day isn't coming in the near future, but it seems to this blogger that it would be prudent to figure what the heck we're going to do next.
It seems the oil apologists are stuck in a 20th century mindset (just like they are in foreign policy). The same thing can be said for the coal apologists here in Kansas.
The solution to the oil issue isn't to figure out a way to bring down the price of gasoline and ween ourselves off of foreign oil, its to figure out a cost-effective way to ween ourselves off oil in general.