By BILL KING By BILL KING ADVERTISING Houston Chronicle I had intended to continue the discussion on the war on drugs from last week, but I was so annoyed by President Obama’s energy speech last week that I had to
By BILL KING
Houston Chronicle
I had intended to continue the discussion on the war on drugs from last week, but I was so annoyed by President Obama’s energy speech last week that I had to postpone it for a brief rant about his cynical remarks.
His speech began well enough. He called for energy independence, as has every president since Richard Nixon. He said no one controls the price of gas and that anyone who said he had a plan to reduce the price in the short run was an idiot or liar. (He actually used nicer words than that, but that is what he meant – and he was right.) And he has finally begun to recognize the importance of natural gas as a bridge to alternatives. But after that, the speech went straight downhill.
First, Obama noted that our production of domestic oil has increased and our dependence on foreign oil has decreased since he became president. But a coincidence does not prove causality. We have achieved some marginal improvement in reducing our reliance on foreign oil due to advances in drilling technology and market decisions made by consumers, not because of anything this administration has done. If anything, this administration’s hostility to fossil fuels has retarded domestic production.
He then repeated his mantra that we cannot drill our way to energy independence. While that is almost certainly true, so what? Even if we cannot supply all of our oil needs, that does not mean that we should not develop every single domestic barrel we can. Every barrel of oil we produce here is more than $100 that goes to American land owners, oil field companies and workers and is not shipped overseas, often to people who are not particularly friendly to us.
He also doubled down on his commitment to renewable energy sources, primarily wind, solar and biofuels. The economics of wind and solar have always been challenging, but the recent discoveries of vast domestic reserves of natural gas have made them even more so. There is almost certainly a day in the future when fossil fuels will become so rare and expensive that we will no longer be able to afford to use them as fuel.
But with what some claim is 100 years or more of new reserves of natural gas, the cleanest burning fossil fuel, that day of reckoning has clearly been postponed. While we should continue to invest in basic research on alternative energy sources so they will be ready when we need them, the current deployment of these technologies is just too expensive. Everyone wants wind and solar, but few are willing to pay the higher amounts needed to pay for them.
But unquestionably, the low point in the speech was Obama’s continued villainization of the large oil companies. The president once again called for the elimination of certain tax breaks that oil companies receive, which are primarily based on exploration activities. Just on its face, it’s not an idea seemingly calculated to increase production.
Frankly, I do not know enough about the oil industry to know whether these tax breaks are justified or not. It may be that these particular deductions have outlived their usefulness. But rest assured, Obama’s call for their elimination had nothing to with the merits of their efficacy. It was pure cynical political calculation. Until recently, the president has had every reason to be fairly confident of re-election. The Republicans continue to conduct their circular firing squad masquerading as a primary election and the economy has been slowly improving. However, in the last couple of months, rising gas prices have put a dent in the president’s poll numbers.
Obama’s call for an end to tax breaks for the largest oil companies was nothing more than an attempt to deflect the public’s angst over rising gas prices onto the oil companies. An analysis done by Robert Shapiro, a Democrat who served in the Clinton administration, found that approximately 50 percent of the shares of the largest oil companies were owned by pension funds and individual 401(k) accounts. So who exactly do you think higher taxes on these companies are mostly going hurt?
The last thing we need right now is for the president to be finding new ways to set us against each other. What we need is a leader who will drop the election rhetoric and lay out an energy policy based on economic realities and our national interests.
