Shorter Bush / McCain Energy Policy
Or:
The best way to wean an addict off heroin is to provide him with new sources of heroin.
It’s 2008. The gasoline-powered internal combustion engine is century-old technology. It’s time for something new to be developed for the mass market, because the supply of gas isn’t infinite, and people will always want personal means of conveyance.
To drill now would not lead to oil independence, and benefits would not be felt for a decade. It’s an oversimplistic answer to the question of $4.00/gallon oil.
The X-Prize foundation has a $10 million prize available to the team that can meet this goal:
To inspire a new generation of viable, super-efficient vehicles that help break our addiction to oil and stem the effects of climate change.
And then there’s Joe Biden’s point on yesterday’s Meet the Press: There are already millions of offshore acres available to oil companies for drilling - right now - that they’re not taking advantage of.
We’re not trying to get Saudi to drill more, we’re trying to get them to pump more of what they’re drilling. They’re not pumping what they could, number one. This is a gift, a gift to the oil companies by John McCain. They have now leased 41 million acres of offshore leases. They’re only pumping in 10.2 million of those acres. Seventy-nine percent of all the offshore oil available off the coast of Florida, into the Gulf of Mexico, the Atlantic Coast, the Pacific Coast, lies within those acres that they now have. Why are they not pumping? Why are they not doing this? Why are they not pursuing what’s estimated to be a total of 70–54 billion barrels of oil at their disposal right now if they pump? Why are these greedy fellows deciding they want to go beyond that? It’s because they want to get it in before George Bush leaves the presidency. It’s because they’re not pumping the oil to keep the price up. They are not even drilling. So here you have 30 million leased acres they have right now that possesses 79 percent of all the offshore, and they’re not drilling. And John says they need more? And it would take 10 years for it to come online.
Biden’s point - the oil companies are keeping supply artificially low (as OPEC is) in order to make the price, and their profits, jump.
al-alo Says:June 23rd, 2008 at 7:38 am
the price at the pump is only one way we pay for high oil prices.
its in plastic and fertilizers. that sprawl we build, even with 200 mpg cars, the infastructure needs to be built. and of course that takes oil to build and oil to manufacture the materials.
forget the offshore drilling. forget ANWAR. its like a band aid on a neck wound - impractical and not effective. its time we just realized it. more regional based economies. more density. better transportation alternatives. it really isnt that hard.
hank Says:June 23rd, 2008 at 8:39 am
It’s 2008. The gasoline-powered internal combustion engine is century-old technology. It’s time for something new to be developed for the mass market, because the supply of gas isn’t infinite, and people will always want personal means of conveyance.
And we need a 2008 solution. Just because a lawyer can run out and buy the newest technology means everyone can. Take a look around the streets Alan. Do you think all those people driving those old ass cars are doing so because they can afford a Prius and they’re just waiting for one to come in to the dealer?
I just had a lady call 10 minutes ago looking for door weatherstrips for an 86 Celebrity because “I CAN’T AFFORD TO BUY A NEW CAR”.
Develop whatever alternate fuel solution you want. It’s not a 2008 solution either–or a 2020 one for that matter.
Whether you like it or not, Oil fuels the world economy. No shame in working toward changing it. But you may see global financial failures in the meantime.
Even King Abdullah blames the speculators for 50% of the price of a barrel of oil right now. Heard him say it in a speech yesterday. He wasn’t rubbing his hands greedily while saying it.
My son-in-law works for a petroleum company in Louisiana.. His last trip was not to Alaska, but to Ploesti, Romania—One hell of a big oil field.
drilling isn’t the solution when you have no excess refining capacity. We could pump 30 million barrels a day. Without being able to refine it into gasoline, it’s not of much help. Ever think THAT’s why they don’t drill on the leases they have? Liberals and Envriro-whackos have put the kibosh on refinery building since I was 19 years old. Now that I’m 51, perhaps it’s time for the greenies to let go and allow some refineries to be built. Then drilling would be an option worth persuing.
steve Says:June 23rd, 2008 at 8:58 am
If the issue were only transportation, this might be a somewhat easier fix. As others have pointed out, oil products are vital to so many other industries. Oil is responsible for about 3 percent of the nation’s electricity generation capability, for instance. Doesn’t sound like much, but that is double the output of so-called alternative fuels — wind, solar, biomass, etc. (EEI - 12/2006) Combined with natural gas (the price of which is rising as rapidly as oil), it’s almost 22 percent of generating capacity.
We have a long-term problem that will require long-term solutions — probably several solutions.
– Americans must change consumption habits, but also help the world embrace efficiency (see India and China). A tall order, I know, but one worth embracing.
– Alternative fuels, particularly solar and wind, must be pushed, but also must be made more cost effective because today they aren’t. Not in comparison with coal, particularly. They exist today largely because of govt. subsidies.
– We should look to nuclear generation, as well.
– And, if we are to remain dependent on oil for the foreseeable future, we must drill and we must allow the construction of the refineries to handle it.
Finally, I think we all need to get used to prices none of us could have imagined just a few years ago. Our overall energy picture needs to be fixed, and it won’t be cheap.
Chris Smith Says:June 23rd, 2008 at 9:16 am
During the oil hearings in the House last week, Rep. Rahm Emanuel cited evidence that the oil companies already have access to 68MM acres of on-shore and off-shore public land which was leased for oil and gas drilling. Those acres have gone untouched. Anyone have a source for that?
I haven’t had the wherewithal to verify that or to find out if the land has oil deposits present. If this is true, it sounds to me like the oil companies already have land in the US on which to drill and increase production.
Russell Says:June 23rd, 2008 at 9:30 am
Like Hank eventually said, the real problem is not how many barrels are pumped per day or how much land there is to drill in offshore. The real problem is that we’re still operating on a 1970s production model. We have not built any new refineries since then, but our demand has changed significantly.
We need both a quick fix to help with soaring prices today, but we also need a long term plan for the future. The long term plan, however, needs to incorporate not only development of new alternatives, but how every facet of our economy will be able to shift to those alternatives without causing a major economic collapse. That’s the real rub.
That said, I think the offshore drilling is just window dressing and a political ploy for the Republicans. However, other than criticism of this move and rhetoric from Obama, I have not seen any real plan from him either. I have not seen anything real on this from either candidate or anyone in any leadership capacity. We need less demand, higher supply, and less dependence. Everyone agrees on that with variances in which area they key on. The question no one is honestly approaching is how.
Chris Smith Says:June 23rd, 2008 at 9:31 am
Hank, I’ve never bought the refining capacity myth. Since 1980, only one permit for a new refinery has been filed in the US. ONE.
According to internal memoranda from Exxon, Chevron, Mobil, and the American Petroleum Institute, the oil companies have purposefully been depressing refining capacity in order to create their own bottleneck to increase the price of the finished goods.
Rudimentary bottleneck theory:
Raw Materials >>>> Bottleneck >>>>>>>>>>>> Finished Goods
The longer the bottleneck, the longer the speculation chain and the higher the profits since supply is depressed which increases demand.
Sure, speculators are running up the price but the oil companies are certainly complicit in the creation and maintenance of the bottleneck as well as allegedly not utilizing their available drilling areas. Hey, if I ran an oil company and was required to maximize shareholder value by increasing profits, I’d do the same damn thing.
Chris Smith Says:June 23rd, 2008 at 9:35 am
Russell, not to turn this into an Obam/McCain debate, but most Democrats (including Obama) know that the solution to the problem of high oil prices is not one that can be implemented in the short term. It’s a long term plan to reduce demand, change our national transportation spending programs, and develop alternative fuels. In the end, high oil prices will do more to stimulate the private sector to develop alternative production and consumption models.
I think everyone agrees that high level policy needs to change (whether you believe it needs to due to climate or economic reasons), so we have a general base level of motivation to change our national priorities. Which is a very good thing.
Russell Says:June 23rd, 2008 at 10:12 am
Yes, we have the general base level of motivation. I agree that is a good thing. The problem is that nothing real has gone past that base level.
Our transportation spending really only equates to a drop in the bucket of this entire mess. If we lower our gas consumption significantly, it still would not result in much of a change in prices. Oil demand is being driven by China. Significant changes there would have the greatest impact on prices, but we cannot do anything about that. Jim Cramer of Mad Money made this point this morning and on other occasions.
There needs to be some short term relief along with the long term planning. That should not just be a Democrat or Republican thing. And I thought the headline for this post made it a McCain thing and linking him to Bush seemed to make it an Obama/McCain debate since that’s why McCain is linked to Bush.
Chris Smith Says:June 23rd, 2008 at 10:31 am
I didn’t write the headline and I was referencing our discussion staying away from Obama/McCain rhetoric.
I’d argue that our transportation spending has a lot more to do with this then we think. Since 1950, the overwhelming majority of federal transportation spending has been directed towards highway construction, sprawl planning, and automobile usage. Thus, we have few alternatives when it comes to means of conveyance. We have citizens who think a 90 mile one way car commute to work is a sustainable idea. The time has passed for all of that, we need to start making the long term investments in changing our consumption patterns if we ever intend to free ourselves of dependence on one particular fuel.
China, India, and other nations certainly affect global oil prices and unfortunately, there is little we can do about that. What we can do is to make investments into reducing demand and reallocating our resources to get off the oil teat.
It took nearly a century to get ourselves in this mess, it’s not going to be fixed overnight. The problem needs big goals and big thinkers, not gas tax holidays and short term market injections.
Ben McD Says:June 23rd, 2008 at 10:36 am
Why not just let oil run out and move on to something else when the time is right? All of this fretting over when and what will take the place of oil isn’t good for anyone’s health. Just keep on keepin on and everything will sort itself out. Oil is still the best thing going and until there isn’t a feasible source, we are not going to move to anything else.
Ben McD Says:June 23rd, 2008 at 10:55 am
“It took nearly a century to get ourselves in this mess, it’s not going to be fixed overnight. The problem needs big goals and big thinkers, not gas tax holidays and short term market injections.”
Why is it a mess. All technologies and methods run their course. Was it a mess when the locomotive reared it’s head and put the crunch on the folks who used horse and buggy? How about when the automobile came along and stifled those folks using the railroads? So the price of fuel has gone up. It’s just an adjustment to changing market conditions. People will change their spending habits accordingly and as fuel becomes more and more expensive, the vaunted “alternative energy sources” will become profitable and more readily available. The problem with big goals and big thinkers is that no one knows what those alternatives will be or how they are going to be implemented. The best thing we can do is to keep our markets, and society, as free as possible to give the risk takers a legitimate shot at paving the way to the future.
hank Says:June 23rd, 2008 at 10:58 am
Chris
Check with the EPA and find out how many roadblocks have been put in the path of new refinery construction.
The number of permits dried up after the enviro-whackos pushed a big government even bigger creating the EPA in 1970–when Geek was probably watching Schoolhouse Rock on TV.
Then when an oil co. WANTS to build a refinery, all the whackos come out of the woodwork, and the oil co’s say “why fight all these groups and spend money and STILL not get the refinery built?”
So be a businessman Chris, and decide if YOU want to spend tens of millions in litigation fighting Greenpeace, the Sierra Club and every other wacko group to get your refinery built, then have the EPA up your ass with a microscope while building it.
Environmentalists are destroying the planet decrying what is done in the USA and Europe while China, India and most of Africa do whatever the hell they please. Good on all you greenie knuckleheads for that.
Chaz Says:June 23rd, 2008 at 11:10 am
@Hank
I thought Buffalo Geek was a businessman? Wait, anyone can be a businessman but it takes a special kind of businessman to run the WNYmediaFAILboat. The business acumen associated with this site is priceless.
We need to increase US based oil supplies while we develop a long term plan for oil replacement. This is going to take years to change.
eac Says:June 23rd, 2008 at 11:53 am
ANWAR, refinery capacity, off-shore drilling; all red herrings. Why are oil companies suddenly ramping up profits? Because they certainly understand that the end of oil is foreseeable now. They have their own scientists and economists, who don’t necessarily present at conferences, or publish, or get involved in the public Peak Oil debate… And they’re saying “better squeeze this dry, boys, starting now.” You want to drill in Alaska, even for a “quick, short term” solution? Don’t even bother, this says it all:
http://flickr.com/photos/raynetoday/315696376/
What we need is to redirect some of our insane defense spending (at around $711 billion, about 45% of the world total; also about 98.6x Iran’s budget) and national focus/ambition from fighting for what’s left of the oil to the development of the alternatives. Fighting for the scraps has made us insecure, and the profits from the scraps go to unscrupulous, democracy-destroying corporations at home and terrorist-organizations abroad. We can do better.
Like the race for the moon in another generation, permanent renewable energy research and industry could be the pride- and respect-boosting economic ticket for this country, if we had the will. Pouring even a quarter of that absurd defense budget into education, research, and entrepreneurial programs would yield, I think, much quicker results than people typically predict. The skyrocketing price per barrel does indeed help make this both more likely and more urgent.
That, i”d argue, is a post 9/11-mentality.
Howard Goldman Says:June 23rd, 2008 at 12:02 pm
All of you my friends, with all due respect, are hamsters curled up in an anxiety ball like Lucinda Basset.
The purveyors of panic have corrupted your minds. I am speaking to all of you, both on the right like Hank and the left like Pundit.
We are not addicted to oil any more than an artist is addicted to paint. Any more than a mother is addicted to caring. Any more than a teacher is addicted to preparing young people for life. Oil is a tool that has marked the greatest upsurge of mankind. Utilizing oil has revolutionized transportation, countless labor saving devices, medicine, building materials, plastics, food production, and information technologies.
The Earth’s energy is the greatest gift to mankind and it should be celebrated. (I must also add that likewise, mankind is the greatest gift to the Earth.) We are using more fuel today because it is being used to elevate humanity. What do you find so depressing about third world nations achieving modernity? That can’t be a bad thing! As the world most benevolent society we should celebrate the freedom and technology that we export. And I do.
Fossil fuels will be out of fashion and irrelevant well before they run dry because we will innovate more convenient and cheaper energy sources. I have no doubt about that.
Fossil fuels are mankind’s bridge between the past and the future, the bridge between potential and accomplishment. Walk with me across this bridge.
No generation and no society has been more blessed than we are. Opportunity abounds. These are exciting times. There is no time to be curled up like a hair-ball.
ike Says:June 23rd, 2008 at 12:35 pm
Unsuprisingly, a democrat showing a complete lack of understanding for basic economics. Biden’s point only stands if there’s collusion between the major oil industry players. If that’s the case tehre are anti-trust laws that need to come into to play.
There could be dozens of reasons why they’re not drilling in the areas already leased. not the least of which might be backlash from “green” politicians.
hank Says:June 23rd, 2008 at 1:05 pm
Ethan–There IS savings to be had in the defense budget. But where things could be cut (NOT WAR ON TERRORISM) you get involved with problems with our alliances and NATO.
I’ll be the absolute FIRST to tell you that we DO NOT need 10K Marines in permanent residence on Okinawa. The last Japanese holdouts on that island finally surrendered at the end of the 60’s. Okinawa is Pacified. In Fact we gave it back to the Japanese in the 70’s. It’s a great place to send Marines for Training, but we don’t need 6 Marine Corps Outpost bases with full facilities in Okinawa.
We also DO NOT need all the Army and Air Force troops that we have in Germany. Germany has been pacified for well over 6O years now. Just no call for it. We DO need some AF personnel to do the medevacs from Iraq and Afghanistan, and a hospital there to do the triage and emergency surgeries until wounded warriors can return to the US for rehab care.
One would think logically that the Sea Lanes of the planet should actually be patrolled by ships of the United Nations, Flying the UN flag. Well, in a more perfect world than we have they would be.
But since the UN isn’t capable of wiping its own ass without US financial aid, we’re doing what they would want us to do. That’s why we have Carrier Battle Groups in every ocean on the planet. This costs us plenty. Does the UN pay the US for protecting the sea lanes? All they would be doing if they did was giving us our own money back.
Somehow I wouldn’t sleep as well at night if in knew that the ChiComs had the largest Navy in the world, protecting the sealanes with Carriers and Nuclear Subs. We’re the only superpower on the planet and the job falls to us.
Space exploration has helped with things like satellite communications, weather forecasting and the like, as well as study of the universe by the Space Telescope, etc. But if you look at NASA’s budget–every nickel they’re spending on exploring Mars should be cut immediately. Nothing up there that would help us in the next 500 years. And we have more immediate uses for the money.
The “Most Ethical Congress in History” has done ZERO to reduce the cost of government. In 06 they told you “Vote us in the majority and we’ll do all those nice things you want” You remember–END THE WAR—SET DATE CERTAIN FOR SURRENDER TO AL-QUEDA—LOWER THE PRICE OF GAS.
How do YOU think they’re doing? The Iraq war has been funded for 2 years now with NO PRECONDITIONS. There has been NO DATE SET for withdrawl from Iraq–Gas has gone up over 2.00 a gallon since the D’s took over–Diesel has gone up 3.00 a gallon. Price of corn is up. And with the floods we see in the mid-west, I guess counting on corn for fuel substitutes isn’t workin’ out too well either.
I guess you got what you voted for–and you’ll run out and vote for more empty promises from Obama–won’t you!!!
dave in Rocha Says:June 23rd, 2008 at 2:00 pm
@Howard: “I must also add that likewise, mankind is the greatest gift to the Earth.”
I wholeheartedly disagree. The Earth was just fine without us for millions upon millions of years, and it’ll continue to be just fine whenever we’re all gone.
@eac
I’m torn on your comment. I’m totally with you on the idea that we need to push harder towards alternative energy sources. If countries like Germany can get 10% of their total energy from wind power by 2010 (according to Wikipedia), then there’s no reason we can’t get similar results. And I do agree that some of that funding could/should come from what seems to be a bloated defense budget. However I have to point out that many, many, many of our technologies and breakthroughs spring from the “defense industry” in one form or another. Defense spending often ends up paying for things like cutting-edge solar panel research for things like satellites, or for research into fusion techniques. The actual money alloted for the defense budget usually ends up going to places like universities or R&D labs in places like Lockheed/Raytheon/Boeing, where a ton of research into all sorts of stuff gets done. I guess if anything I’d say that the military should make alternative energy a priority, and let that directive flesh itself out. If they want something looked into, it’ll get looked into.
eac Says:June 23rd, 2008 at 2:18 pm
@ hank- I haven’t voted for Obama in any way; yet. Some of those cuts you endorse are the ones we need to make, but there are others, too. Do I think the democrats in congress have done a fucking thing but enable Bush since 2006? No, I don’t. I’m not a Democrat. Do I blame the Democrats? Many of them. But I blame Republicans, too. Frankly, I think too many politicians on both sides (and at every level) are principally serving themselves rather than the people.
@Dave- I know what myriad benefits DARPA hath wrought, not the least of which is these very ‘tubes, but it seems to me it’s also a pipeline to lining the pockets of, i.e., The Carlyle Group and others, not to mention the Rayheons of the world- that’s private research, yo. There’s a place for private research, but I think more public research is better; there are always potential ethics and integrity concerns when science is done behind the closed doors of industry. Basic research should be slanted towards public, and applied research can sort of go all over the place.
And we definitely need to pour more money into education if we’re going to stop simply educating the rest of the world to our eventual detriment. Our schools are still the best, but they’re filled with foreign grad students who are going to go back to where they came from and ensure that MIT, Stanford, Harvard, Princton rank up there with Beijing U, New Delhi, Singapore, Hong Kong, and Dubai in the future. We need to get more American kids into these post-graduate programs, or we’re going to loose our last ace.
Mike Walsh Says:June 23rd, 2008 at 3:13 pm
There is no supply problem with oil. There is no delivery problem. Even when Katrina hit and knocked out some of the infrastructure there were only spot shortages. Peak oil is a theory and nothing more. Opec and Exxon aren’t determining the price of crude.
I suggest you look at the relationship between Wallstreet, The Fed, and Washington. Take a close look at monetary policy, bailouts, government spending, etc. over the last few years. See who’s investing in and/or funding speculators in the oil market and connect the dots.
It’s unlikely that anything illegal is going on but the greed and ethics involved would make the Enron boys envious. The government, of course, is owned by these institutions, resulting in this “too big to fail” mentality.
The end result is that shysters like this give free market economics a bad name and result in more regulations with even more loopholes in the fine print to exploit the next time.
Forget about the left/right arguments here. Politicians selling their votes to special interests is bipartisan.
Snarky Snarkmore McSnarkamaphone Says:June 23rd, 2008 at 3:26 pm
Your use of the word ‘theory’ indicates that you don’t understand science or research very well. Makes me question the soundness of your economic analysis, therefore. A theory isn’t some kind of “guess” or “hunch.”
Mike Walsh Says:June 23rd, 2008 at 4:11 pm
Snarky, I’m using “theory” in the general sense.Peak oil is theory, unproven as of now. It’s unclear whether it’s a scientific theory or a political theory at this point as the motivation behind the proponents of it is a bit “murky” shall we say.
Greg Says:June 23rd, 2008 at 5:00 pm
they should have been building these platforms 5+ years ago
instead china is putting platforms up in the Gulf of Mexico
yes we need a different engine and fuel type, and people are researching them, but the fact is for now we’re still stuck with good old internal combustion
STEEL Says:June 23rd, 2008 at 5:04 pm
Isn’t God going to keep making oil for us? what’s all the fuss about?
Howard Goldman Says:June 23rd, 2008 at 5:41 pm
Steel is joking but in a way he is actually correct.
There are more known reserves of oil now then ever before.
The low hanging fruit has mostly been harvested but we are further away from running out now then we were 100 years ago.
mike Says:June 23rd, 2008 at 6:47 pm
hanky, Reagan sold out the middle class, thats why you and your crumb friends cant afford a new car. Instead of just finger pointing, put that finger in your ass, it will save you money on tp.
Snarky Snarkmore McSnarkamaphone Says:June 23rd, 2008 at 9:03 pm
@mike,
You continue to abuse the language of science; theories aren’t “proven.”
Mike Walsh Says:June 23rd, 2008 at 10:53 pm
@Howard,
Totally agree.
@Snarky,
Ok, you win. I won’t use the word theory anymore. Fear mongering and myth would be more precise…..
STEEL Says:June 23rd, 2008 at 11:30 pm
No Howard he is making new oil everyday. Only thing I can’t understand is why he did not put it all in a christian country.
Snarky Snarkmore McSnarkamaphone Says:June 24th, 2008 at 12:05 am
@Mike,
well, it turns out, a survey of the published, peer-reviewed real science on peak oil shows a fairly robust consensus that in fact, a) there is logically such a thing, and b) depending on how you calculate it, it’s either past, soon, or 20-50 years down the line. But naturally, this is still potentially all falsifiable. About as likely to be as gravity or evolutionary processes, but nonetheless potentially falsifiable. As suits a real theory.
Given this, it is deciding between those alternatives where there is room to improve the predictive validity of the theory; but the overall concept isn’t really in question.
Mike Walsh Says:June 24th, 2008 at 1:02 am
@snarky,
You have to go back to the origin of this, which is Hubbert’s Peak Theory. Then, you have to factor in the motives of the people who have spun that to todays situation for their own political agenda/beliefs.
Mike Walsh Says:June 24th, 2008 at 1:09 am
I was pumping gas back in 1973, while in high school, when the the price went from 33 cents a gallon to 60 cents. We were bombarded by news stories that oil would run out by 1980 and that the world would be entering a new ice age thereafter.
Russell Says:June 24th, 2008 at 8:23 am
@ Snarky,
Gravity is a law and not all theories are as predictive as others. Social scientists can work on 90-95% confidence intervals, while physical scientists often work more closely to 99.999% and beyond.
hank Says:June 24th, 2008 at 11:44 am
Mike–I’m not Cheryl Crow–But sometimes I think her plumbing is similar to your own.
Reagan Sold out the Middle class?? Are you fucking retarded?
Reagan cut taxes in the 80’s for the first time since JFK did it- and reignited the economic engine that Clinton took credit for.
I take orders for parts from all over the US and the world every day–The lady who can’t afford a new car is no friend of mine. But I wonder if she can’t afford a new car now, after Barry Hussein taxes us to death will she be able to buy food.
Nice try, fucktard.
Denizen Says:June 24th, 2008 at 7:57 pm
With all due respect, you’re a fucking moron.
Timothy Domst Says:June 25th, 2008 at 4:27 pm
I don’t think the oil companies deserve more drilling areas, but the oil business is complicated and not easily rigged like Chris Smith and you other knee-jerk, big-corporation-blamers who love a simple answer like to think. Even Charles Schumer has to admit this, and he loves to shout about gas prices because they hurt poor people harder than rich people. High oil prices are the nasty medicine our country needs to get off the stuff, they will drive innovation.