Friday, February 05, 2016

Oil Dumbness from President Obama

We all know that Mr. Obama hates the oil, gas and coal industries. Apparently he's now decided that as a lame duck, it's time to help boost the stock of his "green energy" buddies (as if the massive waste of millions of dollars into failed and failing green companies hasn't been a signature endeavor of his presidency) by pushing for a huge tax on each barrel of oil amounting to $10.

This "climate change president" who sees global warming or whatever as apparently being worse threat to the world than Russia, China, Iran, North Korea and the alphabet soup of non-state terrorist entities (AQ, AQIP, ISIS, Boco Haram, etc, etc) has decided to kill a few more productive energy jobs on his way out the door.

The Oil & Gas Journal's Bob Tippee has look at this foolishness here:
With his proposal for a “$10/bbl fee on oil paid by oil companies,” the president sides with environmental extremists in conflict not only with Americans who bring oil products to market but also with those who use them.

To fund a “21st Century clean transportation system,” he wants to expropriate one third of the recent value of crude oil from an industry in the throes of a market slump.

His proposal would ravage prospects of 100,000 oil industry workers who have lost their jobs and of thousands still employed but justifiably worried.

It would squelch the recovery of US oil production that will happen when the market regains balance.

And it would fleece consumers. They, not oil companies, ultimately would pay the fee.

Obama launches this assault on national welfare in response to climatological jeopardy evident more in the propaganda of environmental activists than in a temperature record at growing odds with alarming model predictions.

His probably ill-fated lurch offers one benefit. It illuminates the cost of aggressive climate precaution. The 25¢/gal by which it would hike the US gasoline price wouldn’t amount to even a small down payment on the sacrifice Americans must make if they’re to have any hope of influencing global average temperature.

When enough consumers recognize the mistreatment ahead they’ll begin asking questions too long ignored: How serious a threat does climate change really represent? For how much observed warming are people really responsible? Can overhaul of the energy economy really make a meaningful difference?

Oil companies have new reason to demand answers to these questions, to expose the political debate on climate for the sham that it has been, and to resist the stampede Obama wants to start.

Their interests, and the interests of their consumers, depend on rescue of the issue from the distortions of zealotry.
Funny how his "21st Century clean transportation system" involves such 19th Century gems like railways. According to the WaPo,
The administration said it would devote $20 billion of the money raised to expand transit systems in cities, suburbs and rural areas; make high-speed rail a viable alternative to flying in major regional corridors and invest in new rail technologies like maglev; modernize the nation’s freight system; and expand the Transportation Investment Generating Economic Recovery program launched in the 2009 economic stimulus bill to support local projects.
Wait, transit systems in rural areas? Well, I'm sure the farmers of Iowa and Nebraska have just been dying to have a transit system they can hop on to get to town. Texas ranchers, too. Hope the system has cars to tote large tractors and combines from place to place.

It seems odd to me that as cars have gotten more fuel efficient, as pollution as dropped significantly over the past years that this stuff continues to be pushed. I'm surprised he hasn't proposed a "war on methane producing cattle" - a major source of green house gases - perhaps he could could put VP Biden in charge of a "moonshot" to stop cow flatulence. Oh, yes, he already tried that.

Update: One other thing since the "nation's freight system" is run by private companies (and pretty darn efficiently, too) exactly why does the federal government need to throw money at a non-problem?


  1. This is similar to the first Arab oil embargo. World oil prices was controlled (in the US) at $2.50/ barrel which set world prices. The OPEC nations of the Middle East stop shipping oil and world prices went to $10/ barrel. Democrats wanting to protect their voting base, the North East and the West coast, who depended upon imported oil so that they would not be at a disadvantage to the rest of the nation that used mostly domestic oil passed a domestic oil tax of $7.50/ barrel to raise the price to what the east had to pay. However in a few months the embargo soon fell apart and international oil prices dropped back to the pre-embargo price. But the action to undo the tax that they passed on the domestic oil industry took years to undo. So the domestic oil production fell to zilgh. Almost all oil production in the us stopped with the loss of all the talent that it had and most of the drilling equipment was sold as scrap or was sold to over seas producers.
    And the democrats did not shed a tear for the industry.

  2. Anonymous5:52 PM

    $10/bbl tax on $30/bbl now is ludicris!!! Even if the market price swings 50% as it often does, we are still looking at maybe $50/bbl later this year, and is likewise an onerous tax.

    I still think that infrastructure improvements (as opposed to energy policy) needs to be funded as a User Fee. SInce the federal gas tax has NOT been changed in decades, that is the obvious tax which needs to be modified, But the congressional types NEVER want to be associated with any tax, SO obvious is probably impossible. Some other hidden tax like this VAT versions will probably be attempted.
    Stupid is as Stupid does~