Ok, Mr. Obama is touting his "Windfall Profits Tax" on the oil industry again.
I know that some Americans are sheeple that will cheer for this, but for those of you who are not, or at least want to understand what this means, you need to understand who that tax will be levied on.
You can read this breakdown (by the way, this was the Clinton's Undersecretary of Energy and Commerce, not some Right Wing analysis):
http://www.energytomorrow.org/media_center/Shapiro_Pham_Study.pdf
To break it down for you:
Only 1.5% are owned by oil company executives.
Almost 43 percent of oil and natural gas company shares are owned by mutual funds and asset management companies that have mutual funds. Mutual funds manage accounts for 55 million U.S. households with a median income of $68,700.
Twenty seven percent of shares are owned by other institutional investors like pension funds. In 2004, more than 2,600 pension funds run by federal, state and local governments held almost $64 billion in shares of U.S. oil and natural gas companies. These funds represent the major retirement security for the nation's current and retired soldiers, teachers, and police and fire personnel at every level of government.
Fourteen percent of shares are held in IRA and other personal retirement accounts. Forty five million U.S. households have IRA and other personal retirement accounts, with an average account value of just over $22,000.
You see, "Big Oil" is you, and me.
I know that some of you are going to say "I don't own any mutual funds with oil company stock!" or "I only invest in green energy funds," Well do you have a bank account or a credit card, or a home loan, or a car? Do you work for the state, or a privately held company with a retirement plan? Do you go to a school that is funded through public bonding?
There is simply not enough time to trace it all out for you, but in a nut shell, Mr. Obama is threatening to punish our economy because he knows you don't know any better.
He knows what he's saying, and who he's talking to. A "windfall profits tax" on an industry that is 98.5% publicly owned is simply a proposal for another inefficient redistribution program. You see he wants to use the tax funds not burnt in the bureaucracy to help you pay for energy. Just keeps prices high in an already over speculative industry.
Now do your own research. You will be less susceptible to this type of pandering.
The good news is that he can't possibly be this stupid. I think he understands that this type of promise will have to be gutted before he takes office. He has no intension on tanking the US economy for the sake of growing government. At least I hope.
The speculative profits in the oil industry are taken outside of the US by the Saudis, by the refineries in Venezuela, and by every other foreign country & company responsible for supplying us with our energy. So he is offering to punish us rather than them! . . . and you know what? The American people are going to cheer!
It is a socialist idea that making profits is a vice; I consider the real vice is making losses. – Winston Churchill
Negatives:
- Instant reduction in pension funds, IRA's, 401Ks, and mutual funds
- Punish profitability
- Discourage further production
- Competitive disadvantage for American firms (benefits State oil Co of China, Saudi Arabia, Venezuela, Iran, etc.)
- Encourage large oil companies to move over seas
- Environmental damage (American oil is among the most environmentally regulated)
Positives:
- marginal increase in governmental revenues
- - -
How does this help solve the problem? At best, they will take money from my investments and give a small percentage of that back to me. I just don't get it.
If the oil companies are doing some sort of market manipulation that is illegal, nail them. If they are just making lots of money off of us oil addicted fools, so what?
I am surprised to hear so many other politicians also touting this punishment philosophy. Especially since it was useless during the last real crisis in the seventies. I agree, it can't be seriously considered and is offered as a threat at best. Its about as useful as thinking that opening drilling in protected areas will solve a problem that is apparently not supply/demand in nature.
Your argument Gassy, is specious at best. We're all invested in pharmaceuticals as well. Should we give these huge companies a break from scrutiny because they attracted widespread investment from the average American? What about tobacco? It was heavily supported by the public too. And if the real problem turns out to be greedy speculators is your argument any less applicable? Shouldn't they be given a break since they are just exercising the American dream of cornering and manipulating a market?
Might as well give carte blanche to all industry. Or...is that what you fantasize about anyway...
quote:
Originally posted by Gaspar
Ok, Mr. Obama is touting his "Windfall Profits Tax" on the oil industry again.
I know that some Americans are sheeple that will cheer for this, but for those of you who are not, or at least want to understand what this means, you need to understand who that tax will be levied on.
So if anyone disagrees with you they're a "sheep." Nice way to win others over to your side.
The reason why politicians are touting this is due to the high price of gas. Tell people if they vote for you that you will punish those responsible for the high gas prices. Buying votes, one half-baked promise at a time.
More exploration would bolster supply, I don't see how this is flawed logic. Cut consumption, increase supply, prices come down and reserves last for a longer period of time.
It's past time for Democrats to stop demonizing the Oil Industry. The party needs to build alliances with Oil.
quote:
Originally posted by Hometown
It's past time for Democrats to stop demonizing the Oil Industry. The party needs to build alliances with Oil.
This issue's a non-starter when you've got even Bill O'Reilly ranting and raving about how the oil companies are ripping people off and there needs to be intervention.
Remember, there's an ongoing investigation about possible collusion by the oil companies. If true, those howls of "do something!" will grow louder.
quote:
Originally posted by bugo
quote:
Originally posted by Gaspar
Ok, Mr. Obama is touting his "Windfall Profits Tax" on the oil industry again.
I know that some Americans are sheeple that will cheer for this, but for those of you who are not, or at least want to understand what this means, you need to understand who that tax will be levied on.
So if anyone disagrees with you they're a "sheep." Nice way to win others over to your side.
No Bugo, I am referring to people that don't understand economics. If you disagree with me, then pose your argument. It may have more merit than my own. I am flawed in many ways, as are some of my arguments, but I base everything I stated here on fact. If you have other facts than let us evaluate them.
This discussion forum is an opportunity for all of us to grow and understand, but I will not follow blindly or without logical examination. Sheeple do that.
Oh I just know FOTD will chime in soon!
Obama will seek $150 billion over 10 years to develop more clean energy. He'd double vehicle fuel standards in 18 years and encourage alternative energy sources from the tax collected.
Weep and whine. The oilies have had more than a windfall the last 8 years. Don't vote for him. Does it appear he needs your vote?
OK
So yes, I agree on principle with most of what's being said here, re: taxes on a specific profit level. (Though it's only "punitive" if you're a Milton Friedman groupie; it is narrowly selective and not very fair, though, and that's the part I object to.)
But so what should be done? Opening more land to drilling is all well and good, but that's oil that won't come online for years and years, and it's simply impossible that opening new lands now will alleviate near term pricing problems. Conservation on a large scale is also a good ways off; we can't even get the Administration to support tightening CAFE standards, much less support larger scale efforts like mandating that all cars must have hybrid engines, or, god forbid, reinstating a national speed limit of 55mph . . . [;)]
So where does the relief come from? Or do we just suck it up and deal? There aren't a lot of ways the American consumer can feasibly react to energy price increases. Make fewer trips, yes, but apart from buying a different car, moving closer to where you work, or similar dislocations and major expenses, there aren't many good options. And you still have to heat your home. And you still have to eat food that was trucked in from somewhere else.
I'm just saying, of all the available short term options, I can see where this might be compelling to some folks. I mean, really . . . if the windfall tax was at 15% the last quarter of 2007, Exxon Mobil would've paid out $1.755 billion on profits of $11.7 billion. They still would've been in the black by $9.945 billion.
Wow, I'm continually surprised by the gall of my cousins.
FOTD is already telling people Mr. Obama doesn't need their votes.
Last night I heard an Obama sound bite where he references the end of his second term as president.
Obama talking head: Clinton as vp would spoil Obama's brand.
God I'm glad I lived this long. It's just incredible what comes down.
Wevus,
Given all the negatives I illustrated, where do the positives come in? Exxon would still be in the black, yes. But given all those negatives the Federal government gains less than one tenth of one percent of its needed revenue.
The solution is primarily "deal with it" as you pointed out. High energy prices are here to stay. The windfall profit tax, even if we seized 100% of their profits, will do NOTHING to reduce energy prices.
We have spent 60 years now gearing our transportation system to cheap oil (moving to suburbs, buying big cars, building more lanes, killing trains and mass transit), 30 of those years knowing DAMN WELL that it was a mistake (1970's anyone?). Now we pay the piper.
The long-term solution is to let the market dictate new and better technologies (GM shutting down truck plants, people actually driving the speed limit, distance to work a primary factor for realtors now). Government can help by encouraging those technologies in research grants, inducement prizes (the government has the ability to guarantee HUGE orders), tax incentives, and policy (streamline nuclear regulation YESTERDAY). I have outlined this in detail previously and would be happy to do so again.
BUT, given the choice between more drilling and taxing oil companies more, which realistically would have a positive impact on prices? Clearly more drilling is not the long term solution and would not have a ground-breaking impact, but those are the two main proposals on the table of our two party system.
/don't construe this as arguing against revocation of the tax breaks for oil companies. I am not too familiar with them, but unless they are encouraging these companies to increase domestic supply or other items that make national sense... they don't need it. Yet another fine example of abusing our current tax system it appears.
Are there honestly people out there so confident that Obama will win this election, which is still 5 MONTHS FROM NOW, that they are basically telling folks "Hey, I do not care if you agree with Obama or not, because Obama does not need your vote anyway!"
Ok, lets play FOTD's advocate. What could possibly happen if the windfall profit tax went into place (or back into place, we already tried it in the 70s, but since we don't know we are doomed to repeat, bla, bla, bla)?
I am an oil company, I am squeezed by taxes, I make less than a 4% profit on my goods. I rely on volume sales, but that volume is shrinking because of price. I cannot acquire my product domestically and when I acquire from foreign sources I am squeezed again, and whipped by speculative trading.
Now my government is going to punish me, not for my profit margin, but for my bare ability to make a profit. The only thing that keeps me in this country is my distribution is reliant on the US economy. My government is going to take away the money that I earn for my stockholders and redistribute it back to my stockholders in a lesser manner under the guise of punishing me. All to acquire votes from people who don't understand my business.
I THINK I WILL MOVE TO ANOTHER COUNTRY. SHOULD I TAKE THE 10,000 PEOPLE I EMPLOY WITH ME? NAH I'LL JUST HIRE CHEAPER LABOR WHEN I GET THERE.
I think this is a good exercise. Now could some "Przyjaciel diab#322;a" provide a different scenario?
Oil is due another bust. Cesar Chavez says that 10 percent of the cost of oil is a result of Bush scare tactics. Industry experts say that supply doesn't justify the current run up. When it goes bust Tulsa and Oklahoma will feel it but because oil is cyclical it shouldn't surprise us. When it goes bust it's time to lay groundwork for the next upwards spike in prices so that Tulsa can clean up as we continue to move into peak oil.
Anne Richards was the model Democrat in regards to oil. Oil butters are bread here in Oklahoma.
quote:
Originally posted by cannon_fodder
Wevus,
Given all the negatives I illustrated, where do the positives come in? Exxon would still be in the black, yes. But given all those negatives the Federal government gains less than one tenth of one percent of its needed revenue.
The solution is primarily "deal with it" as you pointed out. High energy prices are here to stay. The windfall profit tax, even if we seized 100% of their profits, will do NOTHING to reduce energy prices.
We have spent 60 years now gearing our transportation system to cheap oil (moving to suburbs, buying big cars, building more lanes, killing trains and mass transit), 30 of those years knowing DAMN WELL that it was a mistake (1970's anyone?). Now we pay the piper.
The long-term solution is to let the market dictate new and better technologies (GM shutting down truck plants, people actually driving the speed limit, distance to work a primary factor for realtors now). Government can help by encouraging those technologies in research grants, inducement prizes (the government has the ability to guarantee HUGE orders), tax incentives, and policy (streamline nuclear regulation YESTERDAY). I have outlined this in detail previously and would be happy to do so again.
BUT, given the choice between more drilling and taxing oil companies more, which realistically would have a positive impact on prices? Clearly more drilling is not the long term solution and would not have a ground-breaking impact, but those are the two main proposals on the table of our two party system.
/don't construe this as arguing against revocation of the tax breaks for oil companies. I am not too familiar with them, but unless they are encouraging these companies to increase domestic supply or other items that make national sense... they don't need it. Yet another fine example of abusing our current tax system it appears.
Of course, nevermind that confiscation of profit from oil companies would limit expansion and repair of oil exploration, transportation, and refining infrastructure which is helping many segments of our economy right now.
If I'm understanding correctly, this would basically add more subsidy to alternative fuels whilst hobbling big oil and making US oil companies less competitive on a global scale. Total BS idea.
Are we getting ****ed by big oil? You bet. Some of the blame for that falls on questionable energy policies in the US for the last half century.
Okay, say we do start drilling in the Anwar, how long will it take to get the operation up to a full run? how long will it take for that oil to start flowing into our pipelines? Are the refineries that we currently have able to handle the increased production flow? Will that help us in this situation in the next 6 to 12 months? How will that reduce the price at the pump in the next 6 weeks? 12 weeks? 6 months?
quote:
Originally posted by joiei
Okay, say we do start drilling in the Anwar, how long will it take to get the operation up to a full run? how long will it take for that oil to start flowing into our pipelines? Are the refineries that we currently have able to handle the increased production flow? Will that help us in this situation in the next 6 to 12 months? How will that reduce the price at the pump in the next 6 weeks? 12 weeks? 6 months?
6 years?
And if we'd have started drilling in 1995, we would have been pumping oil from there for a few years already. Just because it might be 6 to 8 years for production to hit full-stride, it's no excuse not to get started on it.
The only strategic end-game I can see to holding off on drilling our own reserves (congrats, the Chinese and Cubans will now be drilling off Florida, since we ruled that possibility out) is if we are the last country left with vast reserves which means we would control the market 30 years from now. Unfortunately, that does nothing to help now.
The Gov't needs to back up, allow more drilling domestically, allow some refinery expansion, thereby putting extra profits to work by oil companies as they should be.
quote:
Originally posted by joiei
Okay, say we do start drilling in the Anwar, how long will it take to get the operation up to a full run? how long will it take for that oil to start flowing into our pipelines? Are the refineries that we currently have able to handle the increased production flow? Will that help us in this situation in the next 6 to 12 months? How will that reduce the price at the pump in the next 6 weeks? 12 weeks? 6 months?
The prices are set through speculation of supply that is forecast over long periods of time. Every-time we even hint that we are going to start digging, the price shoots down. If we actually start to drill, it may be 10 years (more realistic) until the supply is ready, but the moment we make the announcement the price will plummet.
The biggest fear among Arab countries is that we start drilling. Their entire economy and way of life is built on our daily purchases of oil. They have trillions of dollars of american money spread around just a handful of very wealthy sheiks. Most of their people still starve and we fund that philosophy.
quote:
Originally posted by Gaspar
The biggest fear among Arab countries is that we start drilling.
I don't think that's true. The largest possible amount in the ground in ANWR is still small compared to proven Mid East reserves. There's no practical way that allowing more drilling in the US will somehow liberate us from Mid East oil. The only way to do that is to cultivate alternative sources of energy.
When talking about the market impact of arctic drilling remember several things:
1) The volume needed to drastically reduce prices is small. All we need to do is push the supply 1 barrel above demand.
2) Speculation is driving oil prices. CW says we are running out, so we are. Access to a huge new reserve in the future would drive prices down on the futures market today (and the spot usually follows) even though supply is years out.
3) ANWR is not an insignificant amount of oil. It is not a savior, but the security in supply that it provides will quell market concerns (see above).
4) Your arguments are not really arguments AGAINST drilling, simply reasons why the effects of drilling won't be the savior. Which few argue that it will be, but it will help. If given the choice of tapping $1 Trillion of domestic oil or letting it just sit there; which decision will have the most positive economic impact (including the effects on oil prices?).
- - -
These are two separate mutually exclusive decisions. Drill or not. New tax on oil companies or not. And as of yet, no one has made a coherent argument that failing to utilize domestic resources or taxing oil profits will have a positive impact on the issues at hand.
quote:
Originally posted by we vs us
quote:
Originally posted by Gaspar
The biggest fear among Arab countries is that we start drilling.
I don't think that's true. The largest possible amount in the ground in ANWR is still small compared to proven Mid East reserves. There's no practical way that allowing more drilling in the US will somehow liberate us from Mid East oil. The only way to do that is to cultivate alternative sources of energy.
Check out shale oil in the Rockies and Utah. ANWAR is only drop in the bucket, not to mention the right, left and gulf coasts.
We have more oil than we could use for the next 60-75 years, but environmental regs make drilling an almost impossible feat.
quote:
Originally posted by cannon_fodder
Given all the negatives I illustrated, where do the positives come in?
I'm not so sure I agree with Gaspar's statment that "'Big Oil' is you and me". Sure, most of us own stock, but the richest 10% of us own 90% of the stock (//%22http://www.cbsnews.com/stories/2007/02/18/sunday/main2491066.shtml%22), with a median holding of $110,000 in stock per household. Now, the richest 10% are by no means all filthy rich, many would probably still be considered upper middle-class. I'd simply like to point out that with stock as with all wealth, there is inequality,
not that there's anything inherently wrong with that. So, the wage worker filling his tank every week may indeed be "Big Oil", but not so much when compared to others.
The richest 1 percent, households with an average annual income of $326,720 (//%22http://www.commondreams.org/headlines06/1103-02.htm%22) now get about 15% of the nation's annual income (//%22http://www.csmonitor.com/2006/0306/p16s01-coop.html%22), which is very close the the 18% in 1913, i.e., the Gilded Age, robber barons, etc. Again, not that there's anything inherently wrong with wealth, even ostentatious wealth. Just wanted to provide some history and perspective.
I don't know if the rich
deserve a soaking, that's a moral judgement. But I do know that if the need is great, taxing the pants off the rich is a workable option.
FDR started taxing the very wealthy in 1935. By 1942, some of their tax rates reached 93%. FDR (and Truman, and IKE for that matter) emptied out mansions across the US, by 1963, income of that top slice shrunk from 18% to 8% of the Nation's income. Now, it's back at 15%.
So, did all that socialism and income redistribution ruin America? I don't think so. The wealth of the rich helped pull us out of the Great Depression, finance a global war for Democracy, and pay for the GI bill among other things. It led directly to the longest and strongest burst of economic expansion in US history and to a strong middle-class that has stagnated a bit, but is still strong today.
Whether we are desperate enough to need to turn to such drastic measures is surely a subject for debate. But, if the question is whether or not all of this pinko stuff can work, then I think the answer is that it HAS worked before and it DID NOT ruin us. Quite the opposite.
quote:
Originally posted by iplaw
quote:
Originally posted by we vs us
quote:
Originally posted by Gaspar
The biggest fear among Arab countries is that we start drilling.
I don't think that's true. The largest possible amount in the ground in ANWR is still small compared to proven Mid East reserves. There's no practical way that allowing more drilling in the US will somehow liberate us from Mid East oil. The only way to do that is to cultivate alternative sources of energy.
Check out shale oil in the Rockies and Utah. ANWAR is only drop in the bucket, not to mention the right, left and gulf coasts.
We have more oil than we could use for the next 60-75 years, but environmental regs make drilling an almost impossible feat.
You forgot Montana, where they are now estimating around 40 billion barrels in the Bakken fields.
We still have quite a load here in Ok too.
BTW Last week China started drilling off the coast of Florida and California. Just far enough out to be in international waters. They want to position themselves as our new
overlords energy suppliers. I bet they snicker as they drill and watch our tankers steam by on their way to the persian gulf.
Great!
Two bits of related news to offer.
Abu Dabi is buying the Chrysler building.
http://www.nypost.com/seven/06112008/business/chrysler_bldg__on_the_block_115016.htm
And yesterday:
The Democratic energy package failed. would have imposed a 25 percent tax on any profits of the five largest U.S. oil companies, which together made $36 billion during the first three months of the year. (Again they site "Gross Profit" rather than "Net")
All this bill would have done is hike gas prices by um, uh, oh ABOUT 25%. They are idiots! But then again they knew it would fail, it was just campaign season acrobatics.
Someday, the Republicans need to just surprise them and vote yes on one of these. Then watch how they backpedal to kill the bill. [}:)]
quote:
Originally posted by Conan71
And if we'd have started drilling in 1995, we would have been pumping oil from there for a few years already. Just because it might be 6 to 8 years for production to hit full-stride, it's no excuse not to get started on it.
The only strategic end-game I can see to holding off on drilling our own reserves (congrats, the Chinese and Cubans will now be drilling off Florida, since we ruled that possibility out) is if we are the last country left with vast reserves which means we would control the market 30 years from now. Unfortunately, that does nothing to help now.
The Gov't needs to back up, allow more drilling domestically, allow some refinery expansion, thereby putting extra profits to work by oil companies as they should be.
I agree that there's plenty of blame to go around for this crisis. Keeping ANWR off the table has been, IMO, a mistake, but then so has been an energy plan that doesn't rescind tax breaks for the oil giants, doesn't touch CAFE standards, and doesn't make a serious effort to fund and develop alternatives (nuclear, wind, hydro, solar, etc).
Problem is, placing blame for the past doesn't fix the current predicament. It's dragging our economy into the s***ter now, not in ten years. I'm not enthused about the "ride it out, take yer medicine" theory, especially if this recession measures up to predictions (worst since the Great Depression is what I've heard). If that's even near true, the dislocations and uproar that need addressing now will be pretty significant.
The market is a great thing, but it doesn't care about people. It will fix itself in its own sweet time, but that doesn't address the problems it leaves in its wake.
PS. I'm not arguing for the windfall tax, BTW. Like I said, I don't think it's fair policy, or particularly effective.
quote:
Originally posted by we vs us
I agree that there's plenty of blame to go around for this crisis. Keeping ANWR off the table has been, IMO, a mistake, but then so has been an energy plan that doesn't rescind tax breaks for the oil giants, doesn't touch CAFE standards, and doesn't make a serious effort to fund and develop alternatives (nuclear, wind, hydro, solar, etc).
I agree on the development of alternatives! I invest in quite a few stocks such as Evergreen Solar and other companies that are researching methods of producing energy, cleaner and cheaper. However the amount of surface area necessary for solar to be effective is too great.
Wind power is an option but it's now getting scrutiny from the same environmental groups that block oil exploration. Apparently you need a lot of mills to produce adequate amounts of power for a community, and the mills interfere with the migration of avian species.
Nuclear however is cheep, plentiful, and safe. But the minute it is put on the table again, the Pelosi's of the world will rally against it, and the "Denim Clad" will show up in gas masks to protest.
You see, for some, energy is the enemy!
Allow me to amend that. . . humans are the enemy!
As we move into hard to recover oil and new technologies to extract it, small and independent oil companies are expected to benefit the most. Even though most of the big guys have left town, Tulsa still has a critical mass of small and independent energy companies.
Even though Tulsa has done nothing to retain or grow its energy business, market forces may take care of that for us. That's what I call dumb luck.
One of Tulsa's greatest but least appreciated assets is the "good will" we enjoy in the energy business. That's worth serious money.
It's in our best interest to avoid penalizing oil.
quote:
Originally posted by Hometown
As we move into hard to recover oil and new technologies to extract it, small and independent oil companies are expected to benefit the most. Even though most of the big guys have left town, Tulsa still has a critical mass of small and independent energy companies.
Even though Tulsa has done nothing to retain or grow its energy business, market forces may take care of that for us. That's what I call dumb luck.
One of Tulsa's greatest but least appreciated assets is the "good will" we enjoy in the energy business. That's worth serious money.
It's in our best interest to avoid penalizing oil.
I think it's also in our best interest to continue to invest in our local energy companies. After all, they are our friends and neighbors, and they have remained here in spite of some pretty poor times.
"Excess" profits only exist where there is no consumer choice. Consumers vote with their wallet when given the chance. If excess profits taxes are to be applied, they should be across the board. They should include the news media, the pharmaceutical companies etc. What would be the standard acceptable profit? At what tax level would these excess profiteers leave the country? I don't have the answers here, only a few questions.
quote:
Originally posted by Red Arrow
"Excess" profits only exist where there is no consumer choice. Consumers vote with their wallet when given the chance. If excess profits taxes are to be applied, they should be across the board. They should include the news media, the pharmaceutical companies etc. What would be the standard acceptable profit? At what tax level would these excess profiteers leave the country? I don't have the answers here, only a few questions.
Blasphemy! How dare you ask those questions. Dems don't want to hear the questions!
Your mention of "across the board regulation" will get them salivating. Don't ring that bell again!
Why don't we just send all of our income to the government and then they can decide what to send back? Would make things simpler! Someone should suggest that to Obama.
I bet if he proposed it, people would faint with joy! After all, we are just government educated idiots.
(http://sayanythingblog.com/images/200806091407.jpg)
Guess who he's voting for?
Yep!
quote:
Originally posted by spoonbill
I bet if he proposed it, people would faint with joy! After all, we are just government educated idiots.
But at least he's not so delusional as to call the federal deficit "imaginary." [;)]
Therin lies the problem with "alternative" energy. There is a yin and yang to every single one of them.
Wind power- affects migrating bird species and wind farms screw with weather radar and, apparently, navigation radar for aircraft.
Solar- requires massive battery banks which means more lead, takes a lot of surface area to generate mass amounts as Gaspar pointed out (though on a house-by-house basis it's totally feasible, just expensive to install)
Bio-fuels- "takes food out of the starving mouths of babies" [:o)]. Takes a fair amount of fossil fuel to make ethanol. Bio-diesel plants can fire their boilers on bio-D. There's not been a successful ethanol boiler burner to date. Boilers are required for both processes. As well, bio-d generates massive amounts of glycerin for which there are not enough uses for it at this time, so it creates a stock-pile of waste. And no, there is no good solution for disposal of it at this point, farmers aren't that avid to spray it on their fields and it's not being used wide-spread for hog feed.
Hydro-electric- very efficient and clean, but disrupts fish and wildlife habitats.
Nuke- dollar-for-dollar one of the best alternatives. Negatives? I don't think I need to expand.
Bio-mass reactors- best part is, they can run on waste byproducts of other processes. Possible pollution issues, high cost going in.
Each and every one of these has something for the environmentalists to hate. Granted, we can't ride roughshod over the entire eco-system, but at some point you have to weigh the impact with the benefits of a given energy.
quote:
Originally posted by we vs us
quote:
Originally posted by Conan71
And if we'd have started drilling in 1995, we would have been pumping oil from there for a few years already. Just because it might be 6 to 8 years for production to hit full-stride, it's no excuse not to get started on it.
The only strategic end-game I can see to holding off on drilling our own reserves (congrats, the Chinese and Cubans will now be drilling off Florida, since we ruled that possibility out) is if we are the last country left with vast reserves which means we would control the market 30 years from now. Unfortunately, that does nothing to help now.
The Gov't needs to back up, allow more drilling domestically, allow some refinery expansion, thereby putting extra profits to work by oil companies as they should be.
I agree that there's plenty of blame to go around for this crisis. Keeping ANWR off the table has been, IMO, a mistake, but then so has been an energy plan that doesn't rescind tax breaks for the oil giants, doesn't touch CAFE standards, and doesn't make a serious effort to fund and develop alternatives (nuclear, wind, hydro, solar, etc).
Problem is, placing blame for the past doesn't fix the current predicament. It's dragging our economy into the s***ter now, not in ten years. I'm not enthused about the "ride it out, take yer medicine" theory, especially if this recession measures up to predictions (worst since the Great Depression is what I've heard). If that's even near true, the dislocations and uproar that need addressing now will be pretty significant.
The market is a great thing, but it doesn't care about people. It will fix itself in its own sweet time, but that doesn't address the problems it leaves in its wake.
PS. I'm not arguing for the windfall tax, BTW. Like I said, I don't think it's fair policy, or particularly effective.
Interesting point of view in Salon on drilling. Who is the real conservative on this issue?
Wednesday, June 18, 2008 10:55 PDT
Gas prices and offshore drilling
Let us suppose, for the moment, that President George Bush, Sen. John McCain, and Florida Gov. Charlie Crist are correct: Offshore drilling will ease pain at the pump for American consumers. I mean it, let's not hold back. Let's give Republicans the full benefit of the doubt. Let's even throw in ANWR, and accept at face value the White House's estimates that there are 18 billion barrels of oil ready to be exploited on the outer continental shelf, and another 11 or 12 billion in Alaska.
Don't even worry about the little problem that it will be years before oil starts flowing from these new oil fields. Let's be really generous. Let's even suppose that merely lifting the federal moratorium on offshore drilling would send such a strong message to energy markets that all those traders currently speculating in oil futures would get spooked and rush to unload their positions. If a fire on one North Sea oil rig can send prices spiking up, what would a huge American commitment to drill anywhere and everywhere do?
The price of oil would drop like a rock! Gas prices might start plummeting before the presidential election! A recession could be averted! Best of all, maybe GM and Ford could renege on their plans to close down their SUV manufacturing plants, because with lower gas prices, Americans would stop buying small hybrid cars and go back to their true gas-guzzling loves.
It could happen. It's certainly not impossible. The reason Republicans -- including the likes of Crist, a one-time opponent of offshore drilling who has performed a truly dazzling flip-flop pirouette on this issue -- are jumping on the politics of offshore drilling is that there is a clear kernel of truth in their stance. There is more oil to be drilled in this world, and more supply will undoubtedly have some effect on prices. Even just the prospect of more supply will likely make a difference. So Bush and McCain's hurtful accusation that Democrats are responsible for high gas prices is not entirely wrong.
So what's the worst that could happen?
If we're going to give Republicans the full benefit of the doubt, then it is only fair to offer the same treatment to Democrats. So let's take their arguments at face value also. There will be oil spills off the coasts of Florida and California, fouling beaches, killing wildlife, and harming tourism. Unrestrained burning of fossil fuels will continue to raise global temperatures and contribute to rising sea levels and devastating extreme weather events. A plunge in the price of oil will derail the current pressing economic incentives to improve energy efficiency and channel investment into research and development of alternative energy technologies.
And ultimately, these new oil fields will be exhausted, and the whole cycle of rising prices and economic pain will begin all over again. Only this time around, our children, or our children's children, will be in much worse shape than we are now. Environmental stresses will be higher, climate change will be further advanced, and there will be even less oil to go around. (Because, of course, while the U.S. is pumping to its heart's content on its outer continental shelf, existing oil fields around the globe will continue to peter out.) Prices will rocket even higher than our current worst nightmares. We will have sacrificed precious decades in which we could have gotten a leg up in figuring out how to maintain properity in a carbon-constrained future. And those madmen and fools who counseled a quick-fix response to humanity's biggest challenge will be excoriated as some of the stupidest, most criminal leaders in human history.
That's all.
Making the political case that high prices and recession now might be necessary to avoid even higher prices, a global depression, and ecological catastrophe later is no easy task -- especially in an election year. Arguing that the smart way to compensate for higher gas prices would be to redistribute wealth so as to bolster the economic position of low- and moderate-income working-class Americans offers Republicans yet another political opportunity to cry havoc and let loose the dogs of class warfare. And as each week goes by and gas prices continue to mount, the resolution to think about the long term weakens. This is eminently understandable.
But maybe the most fascinating aspect to the debate about offshore drilling -- to this profound choice between two worldviews, two ways of being on the planet -- is the harsh light it sheds on the value systems at the heart of how political identity is traditionally seen in the United States.
Republicans have made hay for decades by portraying Democrats as spendthrift, reckless liberals. Their side is supposedly "conservative" -- sober-minded, prudent, levelheaded -- while their opponents are "radical" -- dangerous, risky, foolish.
But what is the truly "conservative" position on offshore drilling, or energy policy in general? Recklessly exhausting all available resources now, and letting the future take care of itself -- or conserving those resources, investing carefully for the future, and thinking about the long term? Where does prudence reside -- in attempting to shave a few pennies off of gas prices now, or on planning on how to cope with high gas prices for the foreseeable future?
If you're looking for a metaphor, try the competing fortunes of Toyota and General Motors on for size. George Bush and John McCain are like the fin-de-siecle executives of GM, living only in the present, catering to their customer's worst impulses in pursuit of maximizing profit in the short term. But Democrats are like Toyota, making a bet on what makes economic sense for the future.
Presumably, Toyota's shareholders are a lot happier than GM's, right now. As shareholders in this planet, what do we want? A good quarter now, at the risk of financial disaster next year? Or a long-term ecologically healthy path to sustained prosperity?
That's what the debate over offshore drilling is really about.
quote:
Originally posted by akupetsky
That's what the debate over offshore drilling is really about.
Using your logic (paragraphs while giving Democrats the benefit), one could make a case to have OPEC start shutting down the flow right now. That would really speed up the search for alternative fuels. We could make even more innovative mistakes like using food stocks for fuel. Politically forcing the rate for technology to advance usually has unintended consequences.
I believe there is a balance closer to the middle. Do something to keep energy at the merely outrageous price level but don't allow it to rise so much as to cripple the world economy.
quote:
I believe there is a balance closer to the middle. Do something to keep energy at the merely outrageous price level but don't allow it to rise so much as to cripple the world economy.
I agree. Don't want to spend taxdollars, go to war or use up geopolitical leverage on artificially reducing the price of oil, but instead have a reasonable energy policy that addresses the medium-to-long term to increase confidence that energy resources will exist in the future, without exacerbating environmental destruction that will increase costs for other things like food, housing, etc. Sounds simple.
quote:
Originally posted by spoonbill
quote:
Originally posted by Red Arrow
"Excess" profits only exist where there is no consumer choice. Consumers vote with their wallet when given the chance. If excess profits taxes are to be applied, they should be across the board. They should include the news media, the pharmaceutical companies etc. What would be the standard acceptable profit? At what tax level would these excess profiteers leave the country? I don't have the answers here, only a few questions.
Blasphemy! How dare you ask those questions. Dems don't want to hear the questions!
Your mention of "across the board regulation" will get them salivating. Don't ring that bell again!
Why don't we just send all of our income to the government and then they can decide what to send back? Would make things simpler! Someone should suggest that to Obama.
I bet if he proposed it, people would faint with joy! After all, we are just government educated idiots.
(http://sayanythingblog.com/images/200806091407.jpg)
Guess who he's voting for?
Yep!
Actually, I am counting on the news media to cry foul when they have to take their own medicine. This would put an abrupt stop to "excess profits" taxes.
quote:
Originally posted by akupetsky
quote:
I believe there is a balance closer to the middle. Do something to keep energy at the merely outrageous price level but don't allow it to rise so much as to cripple the world economy.
I agree. Don't want to spend taxdollars, go to war or use up geopolitical leverage on artificially reducing the price of oil, but instead have a reasonable energy policy that addresses the medium-to-long term to increase confidence that energy resources will exist in the future, without exacerbating environmental destruction that will increase costs for other things like food, housing, etc. Sounds simple.
The problem as it stands now is you have the Executive Branch blaming the Legislative Branch for lack of cohesive policy and vice versa. Then you got the GOP's and Dems in Congress blaming each other for failed policy or lack thereof. I don't know if no one wants to do anything about it or doesn't know where to start. The government seems to have ideas on how to adjust the economy, but can't seem to figure out how to help out the consumer when it comes to fuel?