Tuesday, August 5, 2008

Gasoline and the Strategic Oil Reserve: Obama Plays All Sides

Less than a month ago Barack "World" Obama made the PASSIONATE case that the Strategic Oil Reserve is meant for true national emergencies, and not as a device to try to manipulate gasoline prices.  You will note that Obama says everything "passionately", but expects you to forget today what he said yesterday.  Yes, less than a month later, Obama has signed on with Nancy "Total Faiure" Pelosi and the Democrats, suggesting that we SHOULD use the Strategic Oil Reserve to try to manipulate gasoline prices--combined with that DISCREDITED idea of a "windfall profitts" tax (tried to disastrous effect in the Carter years, as it is a DISINCENTIVE to energy development).  Omama even indicated he would accept "limited" additional drilling--another thing he has been "passionately" against.

Of couurse, Obama fails to explain--as usual--exactly WHAT he did to "bring people together" in the Senate to get a drilling/ energy development bill DONE.  Answer:  He did nothing, zilch, nada, zero, nil, and failied to make any effort to stop the Reid/Pelosi OBSTRUCTONISM on drilling and energy.  This latest speech (Obama is all about speeches) is nothing but political posturing, Democrat style, to try to defuse the DRILLING isssue, upon which Democrat politicians are on the WRONG side (and know it).  The idea is not to actually PASS a drilling/energy bill, but to try to blame the Repubicans for failing to "compromise" after Democrats supposedly make the effort.  It is hard to suggest, however, that Nancy "Total Failure" Pelosi made any effort when she abruptly ADJOURNED the House to PREVENT debate or a vote on REPUBLICAN attempts at an energy bill (Amerndments).  The House left on a FIVE WEEK vacation, with no time left afterward to hammer out an energy bill--especially when the Democrat goal is to CONFUSE the issue rather than to actually pass a bill lifting restrictions on drilling.  For Obama, it is all about speeches, and not about accomplishing anything.  Obama has NOT, and has not intention to, put any pressure on Harry "Drity Oil" Reid or Nancy "Total Failure" Pelosi to cooperate with Republicans to get a bill passed that will remove restrictions on drillinn, while otherwise encouraging energy development. 

Now let us go to thr Republicans, and Rush Limbaugh (yes, yet another time I do not fully agree with Rush).  Republicans, and Rush, are simply dismissing the idea of looking at the Strategic Oil Reserve.  I dismiss it too, in terms of looking at the Reserve as nothing more than a TOOL to maniupulate gasoline prices.  That is NOT its purpose (as Obama originally, passionately, said in the classic Obama cadence--false sincerity dripping off of him like the water he is walking on).  Nevertheless, as readers of this blog know, I have CORRCTLY suggested that we look at the STUPID way we kept PURCHASING oil for the Strategic Oil Reserve, AT ANY PRICE, over the past year.  This was "no brainer" stupidity, and Rush Limbaugh was as stupid as the rest.  As I have said before, NOTHING has made my brother, the co-owner of a trucking company, so mad as that insane policy of the Federal Government continuing to purchase oil--taking it out of the market--as the rising price of diesel fuel was KILLING his company.  Yep.  My brother regarded President Bush and the Federal Government as CONSPIRATORS IN MUNow you can rightly suggest that the effect of these government purchases was small, but the MESSAGE was "no brainer" STUPID.  I have no hesitancy in calling Rush Limbaugh and the Republicans stupid for not realizing this.  In a way, they STILL don't.  President Bush (for whom "hard headed" is an UNDERSTATEMTN) only reluctantly signed the bill ending those Federal PURCHASES as of the end of July.  Yes, amazingly, they only just ended.  What message did it send to the HOARDERS in China and India, and those worldwide oil speculators (Democrat "villains" who operate on a worldwide scale, and are unafraid of Nancy "Total Failure" Pelosi, especially as she does their work for them by BLOCKING drilling)?  What kind of message did it send that we were willing to HOARD oil orselves AT ANY PRICE.

John McCain corre (giving credit where it is due) correctly saw that this was a "no brainer".  He came out relatively early this spring--BEFORE Barack Obama, at least in terms of making an issue of it--for STOPPING these purchases for the Strategic Oil Reserve at ridiculous prices. 

All right.  So far so good.  But for a YEAR (or more), the Federal Government was COMPLICIT in nudging fuel prices ever higher.  This is what made my brother livid.  The Federal Government acted like NOTHING could be done, while they were PURCHASING OIL.  Further, theer was no announcement (as I have suggested) that the FEDERAL GOVERNMENT would CUT its own gasline use (I have suggested 20% IMMEDIATELY).  Nor was there any urgency on drilling, although my brother well recognizes that this was primarily the DEMOCRATS, although McCain was hardly a major force for drilling until recently.  Do you wonder why my brother regarded the Federal Government, including President Bush and Congress, as guilty of MURDER of his company?  The "crisis" this summer did not appear out of thin air.  It was building for at least a YEAR, and really since Katrina.  It was like Nero fiddling while Rome burned.  Yes, the Democrats were WORST, but the lack of URGENCY by Reppublicans, and opinion "leaders" like Limbaugh, was striking.

Have we established that it was INSANE to have been adding to the Strategic Oil Reserve over the last year?  If you don't think so, you have not been paying attention.  Yes, we have been just as INSANE to follow the Democrat policy of "no drilling" for the last TEN YEARS or more (making a mockery of their statements that drilling will take too long, because it may--a lie, unless they make it so--take ten years).  But just because Democrats have been INSANE; that does not justify Republicans, and people like Limbuah, in failing to recognize that things HAD to be done--things like removing the incredibly perverse message that continued, "at any price", purchases for the Strategic Oil Reserve was sending--a message that ANY PRICE was acceptable.

Once we have established that we never should have been adding to the Strategic Oil Reserve for the last YEAR or more, what is the conclusion that should be reached?  Right.  We should REVERSE the MISTAKE, and release those same amounts from the Strategic Oil Reserve--NOT because the Strategic Oil Reserve should be used to manipulate price but because it was a MISTAKE to use the Strategic Oil Rerserve to ADD to the problem in the first place. 

It goes without saying that we should do this ONLY SO LONG AS THE PRICE REMAINS HIGH.  That means, for example, that we should start selling oil out of the Strategic Oil Reserve at the same rate we bought it over the last year (when we should not have been buying it), ONLY so long as the price is $120.00 a barrel or higher (or whatever price you want to set).  You could even set a price--say $70.00--at wich to start REPURCHASING oil for the Reserve.  The idea is to BUY LOW and SELL HIGH.  This will not "solove" gasoline and diesel prices, but IT SENDS THE RIGHT MESSAGE.  If you combine it with an aggressive lifting of DRILLING restrictions, AND with an aggressive reduction of demand BY THE FEDERAL GOVERNMENT, AND OTHER GOVERNMENT ENTITIES, we CAN do a lot about fuel prcies.  The Strategic Oil Reserve part of this is mainly symgolic, but the symbol is important.  The symbol is that we reconginze that, at some point, fuel prices are TOO HIGH, and we have to stop adding to the problem (not only ourselves, but by encouraging others, like China and India sto do so). 

The whole idea is to reverse the PSYCHOLOGY of the market in oil, and introdcue some FEAR that producers (including coutnries like Iran and Saudi Arabia) had better sell their oil now, or they may not have a chance, at these prices, again. 

Thus, I disagree with Rush Limbaugh when he dismisses the Strategic Oil Reserve out of hand as part of a "solutiion".  He is right to dismiss it as "the solution", and to dismiss the Obama/Democrat political posturing on the subject.  That way is disaster.  But if we stop sending the WRONG message with the Strategic Oil Reserve, and start sending the RIGH message (that price matters, and that we will not let the Strategic Oil Reserve contribute to the PROBLEM), that can be importnat.  It MUST be combined with things like more drilling, or Libmaugh wil be right; we will have "risked" the Reserve for no reason.  Further, as suggested above, it must NOT be a policy decision based on USING the Strategic Oil Reserve to manipulate price by releasing substantial amounts from the Reserve (wtih damage to our security).  If we are only REVERSING A MISTAKE, and only if the price remains at a certain level, we are not risking the Reverve at all, in any fundamental way.

Now you can say that I am naive; that once the idea of using the Reserve is accepted, then the REserve is doomed.  That is true ONLY if Republicans/conservatives fail to make their case--fail to do what Democrats are doing with RIGHT on our side.  SAY that Democrats are wrong in wanting to USE the Rserve for the wrong purpose.  SAY that we will only be reversing a MISTAKE that the Federal Government made--a mistake that McCain has already said we made.   Say that even that will only be done if the price remains at the level that made those ppurchases as a MISTAKE< with repurchase as the price gets reasonable.  SAY that this is not meant to be a "solution" of the whole problem but can only work in combination with DRILLING that Democrats hagve refused to let happen.  SAY (this one is the tough part, because NO ONE really wants to suggest that the Federal Government SACRIFICE) that the Federal Government should LEAD by REDUCING its gasoline/diesel consumption, except in war zones.

I tell you it CAN be done.  It is not may fault that no one is doing it.  It is definitely not my fault that the media is lettng Obama get away with SPEECHES doing nothing more that to try to cnfuse the issue with WORDS. 

Democrats have done their best to destroy our economy on an alter of "global warming".  They--not to mention T. Boone Pickens--make clear every day that they do not WANT lower fuel prices.  Republicans have finally started to take it to them on this issue (about time).  If only Republicans could look at this clearly, they could seize this whole issue and run with it. 

P.S.  I, of course, have maintained the above position for many months--actually years.  Unlike Rush, I do not let the Democrat attempt to hijack my position (on the Strategic Oil Reserve) in a dstructive way cause me to change it (just to avoid appearng to side with Democrats).  Nor am I a  total intellectual whore, like Barack "World" Obama--hoping you will forget what I said yeserday.  I try to make this blog as intellectually cnsistent as posslible, and I believe I generally succeed.  You may not like what I say, but you will have to look hard to find any incosnistencies.  Since (contrary to rumor) I am human, an inconsistency may sneak in on rare occasions.  But they are few and far between.   

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