Monday, May 05, 2008


"Let's be calm and conservative"

I was going to give gas prices a rest as a topic of conversation for a while. Over the weekend, however, I received an e-mail from the Campaign for Working Families PAC which I simply must share with you. I couldn't find this particular information on the CWF's Web site, so I'm posting what I received in its entirety. Enjoy.

Let’s Be Calm and Conservative

In recent days, I’ve gotten a lot of questions (not to mention a few angry messages) about oil and gas prices. I don’t like paying these prices either, but it seems that a lot of good people are buying into the rhetoric of the Left, which suggests it’s all George Bush’s fault or some conspiracy in the boardrooms of corporate America.

Here’s the bottom line: This is a fundamental issue of supply and demand. Demand for oil and energy is booming around the world as developing nations, like China and India, grow economically and develop their own middle-classes. As these folks earn more, they want what you and I want – cars, air conditioning, TVs, better food, etc. We cannot freeze economic conditions around the world. As demand for oil increases, supplies get tighter and costs go up. That’s Economics 101. The more important question is: How do we respond to these challenges? I don’t believe the solution lies in punishing the producers of the very products we need most. Unfortunately, that’s exactly what the Left is proposing.

Last week, I noted how U.N. Secretary General Ban Ki-Moon responded to the global food crisis. He warned that the world “must urgently increase food production to ease skyrocketing prices…” The same solution also applies to our growing energy crisis. We must increase production of oil and natural gas in order to meet the increasing demand worldwide. But, in the recent Philadelphia debate, when asked about energy, the only solution Barack Obama had to offer was to control demand, which would cripple our economy. Obama has also suggested imposing a “windfall profits” tax on the oil companies. We tried high taxes and price controls before. Does anybody really want to go back to the Carter malaise days of shortages and gas lines?

[Last] Tuesday, President Bush held a rare Rose Garden press conference to address economic anxieties, and he took the opportunity to castigate the Democrat Congress for doing nothing to help ease the pain at the pump. In 2006, Nancy Pelosi and her fellow liberals promised they would lower gas prices if elected. Well, they won, but prices have gone up, way up. Here are some of the president’s remarks:

…The past 18 months, gas prices have gone up by $1.40 per gallon. Electricity prices for small business and families are rising, as well. …One of the main reasons for high gas prices is that global oil production is not keeping up with growing demand. Members of Congress have been vocal about foreign governments increasing their oil production; yet Congress has been just as vocal in opposition to efforts to expand our production here at home.

They repeatedly blocked environmentally safe exploration in ANWR. The Department of Energy estimates that ANWR could allow America to produce about a million additional barrels of oil every day, which translates to about 27 millions of gallons of gasoline and diesel every day. That would be about a 20-percent increase of oil -- crude oil production over U.S. levels, and it would likely mean lower gas prices. And yet such efforts to explore in ANWR have been consistently blocked.

Congressional liberals didn’t like being called out on their broken promises, but not wanting to be labeled a “do-nothing Congress,” they put together their own list of legislative priorities aimed at controlling speculation in energy commodities markets, ending price gouging and raising taxes on oil companies. Not only was there no serious proposal by the Democrats to boost supply, New York’s senior liberal, Senator Charles Schumer, actually dismissed drilling in ANWR, saying, “ANWR wouldn’t produce a drop of oil in ten years…”

Interestingly, that’s exactly the same thing Bill Clinton said when he vetoed legislation in 1995 that would have permitted additional domestic oil exploration in the United States. In view of today’s record gas prices, rapidly approaching $4.00 a gallon, Clinton’s logic seems rather shortsighted. Had he not vetoed that bill, ANWR’s oil would be on the market today and prices would not be so high. So, instead of blaming George Bush, blame Bill Clinton for high gas prices the next time you fill up!

While Senator Schumer may be willing to bet again on Clinton’s flawed logic, a recent Canadian study predicted that oil prices, and as a result gasoline prices, could double by 2012 due to the growing supply and demand imbalance. The report also states, “An expected drop in demand in the United States due to higher prices and a weak economy will be more than offset by demand growth in developing nations.” In other words, as I noted, we cannot conserve our way out of higher prices because we cannot control demand in other nations. We must increase supply.

Two years ago, in the run-up to the 2006 elections, Senator Schumer said, “If $75 a barrel oil and a $3 average for a gallon of gasoline isn’t a wake-up call, then what is?” I would think that oil at $115 a barrel and gas at $3.50 a gallon would be enough of a wake-up call to realize that the same old do-nothing policies are not working, but evidently not. Let’s pray Senator Schumer and other liberals will have an epiphany, before gas reaches $8.00 a gallon. Let’s not wait another ten years to get a bill to the president’s desk opening ANWR.

If it seems like I have spent a lot of time on this issue, it’s for good reason. Energy is vitally important to our economy and our national security. The issue is also being used to stoke hostility to free markets and to demand more government regulations. The left-wing, socialist politicians, like Chuck Schumer and Barack Obama, who are responsible for the bad energy policies that have created this crisis now want to give us more of what doesn’t work! Let’s be calm and let’s be conservative. Don’t buy into the radical rhetoric and wild conspiracy theories. Tax hikes are not the answer. Punishing the oil companies and giving even more money to feed the appetite of Big Government is not the solution.

I am pleased to report that Senate Republicans have introduced a common-sense, conservative, free market-oriented plan – the American Energy Production Act of 2008. The bill would allow for more domestic oil and natural gas exploration, more use of coal and liquefied coal and it would tap into America’s vast oil shale fields. The result of such a plan, if enacted, would be more oil and natural gas on the market, easing supply constraints and lowering prices. It would also create tens of thousands of new jobs in America, and would go a long way toward achieving energy independence from hostile foreign regimes like Iran and Venezuela. It will take time, so the sooner we change policies, which will mean defeating liberal politicians in Congress, the better!

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