Posted by
John Crutchfield on Thursday, July 24, 2008 7:58:39 AM
For some time, economists have been predicting the price of oil would drop simply in response to serious high level government discussion that the US might begin offshore drilling. The idea was that any dialogue favorable to increasing domestic supply could signal speculators that the party may soon be over. Last week, President Bush lifted the ban on drilling put in place by his father and challenged congress to lift its own version of the ban. Predictably, congressional leaders scoffed at the idea saying: "We can't drill our way out of this problem."
Surprise! A week later, oil prices have dropped and the price of regular at the pump has come down as much as ten to fifteen cents per gallon. Maybe speculating about drilling is having some effect, or maybe it's just a coincidence. Either way, it is a little early to predict the outcome based strictly on dialogue suggesting we might be interested in increased energy independence. While talking about it gives us a glimpse of how the market responds to rhetoric, real and lasting price reductions can only be achieved through increasing supply.
Current majority leaders in congress could never agree to considering offshore oil exploration. To do so would be like admitting they were wrong to oppose it in the first place. And imagine the fallout if that straegy proved to be effective in reducing oil prices. Democrats aren't about to let that happen. That course of action isn't available to those beholden to environmental extremists and billionaire globalist George Sorros. So, what is their plan? It's a shell game, no pun intended.
Harry Reid and Nancy Pelosi recently led congress in forcing Bush to reduce shipments to the Strategic Petroleum Reserve by 70,000 barrels a day, presumably to help ease our pain at the pump. If they think seventy thousand barrels will make a difference, why wouldn't they think a million would be better? They do, but haven't a clue where to get it from.
In an act of utter stupidity, congressional democrats offered another proposal calling for the release of oil from our Strategic Petroleum Reserves. Reid's and Pelosi's so called solution, though flawed, unwittingly revealed that they do understand the laws of supply and demand and acknowlege that we indeed are experiencing the effects of an energy shortage. In spite of this, they will thumb their collective noses at any real remedial measures. Their proposal is bad for America and if we listen to them, we'll lose our safety net and end up more vulnerable than ever to international extortion or worse.
First, the SPR is intended to keep America up and running in the event that our oil supply is abruptly cut off. This is a matter of national security. It's not intended to give temporary comfort to consumers. By using that supply, we weaken our ability to survive a true crisis, should one occur. Second, it isn't cheap. It's hard to find any logic in energy policy that calls for consuming sixty dollar a barrel oil that we'll need to replace with oil that could cost more than twice as much. We'll pay one way or another. By the way, $60 bucks was the price of a barrel of oil when democrats took control of congress in 2006 and promised to do something about high gas prices. Well, they've done something alright, they've made it worse.
Instead of increasing our domestic oil supply, Reid now wants the legislature to consider a bill limiting oil speculation. The strategy, proposed by the democrats, is only the latest example of their endless quest for power and control over everything and speaks volumes of the left's love for the socialist idiology and their contempt for the free market.
Reid, Pelosi and their minions hope to drive down the price of oil by crushing the entrepeneurial spirit that is at the heart of this great nation. Their strategy, if successful in the short term, will undoubtedly make room for a ten cent gas tax, which may be what they've been looking for all along. Having failed to muster support for a windfall profits tax on big oil, they turn to the only other suckers in the room - us. That giant sucking noise is the sound of money leaving our pockets. Memo to Harry and Nancy: The original idea was to LOWER gas prices.
The democrats' solution to our energy woes is the same solution they offer for every other problem - bleed American families dry while gradually claiming more and more regulatory control over our lives. To add insult to injury, a number of republicans are acting just like them, apparently in denial of the socialist cancer metastacizing in the body of congress.
Tapping the SPR is a dangerous move. It compromises our ability to respond to real threats from outside our borders. Keeping America's war machine well lubricated is vital to our defense, although that's not much help against the enemies inside our borders - the congressional traitors we're paying to destroy us.