Jewish World Review Feb 24, 2012/ 1 Adar, 5772
Obama goes gaseous on gas
By Jay Ambrose
http://www.JewishWorldReview.com | To win the debate over gas prices shooting skyward, President Barack Obama must pretend markets do not work the way they do.
He must say he disagrees with his secretary of energy while denying policies curtailing an oil boom. And he must insist he never said commoners with vehicles that guzzle should instead buy sophisticated models that sip.
In fact, he didn't put it quite that way, but it is justified for some commentators to have compared his words to "let them eat cake" after he blurted in April of last year, "If you're complaining about the price of gas and you're only getting eight miles a gallon, you know, you might want to think about a trade-in."
What you actually might want is to trade in a president who thinks everyone can afford that, or, even worse, who calls for kick-fanny tax hikes on roundly excoriated oil companies.
Tax reform is needed, with some deductions eliminated and corporate rates reduced for one and all as our president has recommended, if somewhat timidly and obscurely. But if you decrease oil profits right now, you lessen exploration, diminish America's competitive power and, according to the Congressional Research Service, drive up consumer prices even more.
Wait, some say, eyes ablaze: Oil company profits are outrageously exploitative, an example of villains tying damsels to the railroad track and cheering as the train comes round the bend. Wrong. Relative to the return on the dollar, the profits are so-so and sorely needed to offset the years the oil companies just barely got by.
For many, that information is counterintuitive, which makes it easy to score demagogic points if you are so inclined.
Obama is so inclined.
Those high oil prices are a political liability, after all. And while it's true that improved world economies are increasing demand for tightened supplies, something else is true, too.
As astute observers have noted, the administration would bless those high prices if they generated no angst. The energy secretary, Stephen Chu, has gone on record as liking high oil prices because they facilitate the development of alternative energies, and there are still others in the administration making it clear they will happily denude wallets by not drilling, baby, not drilling.
Obama has said increased oil exploration in the country will not make much of a difference because we have so little of the world's reserves and consume so much of its energy, adding that the production of more oil takes forever to budge prices any. He then tells you we're developing a lot more oil than before. To the extent that we are, it is not because of him.
Oil companies keep finding more reserves accessible through the technology of horizontal drilling, also known as fracking, but waiting for bureaucrats to grant permits is like waiting for an ice age to recede, observers report. The administration has bans on all kinds of onshore and offshore drilling, and you wonder what the EPA will try next in its assault on the oil industry -- have snipers shoot holes in pipelines?
The answer to Obama's tactics is that going all out to produce this oil can provide jobs, empower the economy, make us dramatically less dependent on the Middle East and, yes, help on prices as time passes.
Obama is mainly for increased fuel efficiency and turning more to alternatives to cut down our demand for oil, but this path takes much longer to produce results, and some of the efforts are counterproductive, anti-market, economy-damaging stupidities.
My guess is that Joe the Carpenter needs his pickup a lot more than a heavily subsidized Chevy Volt that still costs $40,000 and can't haul lumber. I bet he gets it that oil will play a major role in vehicular mobility for a long time, and I suspect he is thinking of voting Republican.
Every weekday JewishWorldReview.com publishes what many in in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.
Comment by clicking here.
Jay Ambrose, formerly Washington director of editorial policy for Scripps Howard newspapers and the editor of dailies in El Paso, Texas, and Denver, is a columnist living in Colorado.
© 2011, SCRIPPS HOWARD NEWS SERVICE