Wednesday, February 23, 2011

Remind Me Again Why We Need Domestic Oil Production?

Here we go again: With the turmoil in Libya, continued unrest in Egypt, Iran causing problems in the Suez Canal, and numerous other hot spots around the world, we are again faced with rising oil prices.
When gas prices spiked in 2005-2006 there were calls from around the country to “Drill Here, Drill Now.” Unfortunately when prices dropped so did the will of the American people to push Congress and their state politicians to follow through on the promises of domestic oil production. Luckily, one “benefit” of the recession was a drop in demand for oil and oil products around the world. The poor economy, and lack of demand around the world are really the only reasons we have been paying relatively consistent and fairly reasonable gas prices over the past couple of years.
Now, as we wind our way through the delicate beginnings of a very timid economic recovery we are again faced with rising crude oil prices – at one of the worst possible times. As China and the rest of the developing world continue to grow their economies the demand for oil will certainly increase. Europe seems to be recovering in some ways and many areas of South America never stopped growing. Any of these factors alone contribute to the demand for oil and increasing prices at the pump. Instead of just one reason for increasing prices we have multiple factors all contributing to what may cause another huge economic dip.
Now, two years into this administration, at a time when we were supposed to be generating green power, driving electric vehicles, and generally fulfilling the environmentalists’ dreams, we are stuck. We have wasted almost four years that could have been put toward developing our own domestic energy supplies. Not only did we fail to increase domestic oil production but due to Obama Administration policies – we have been refusing to issue drilling permits and shutting down existing production in other areas.
A common argument from the left when it comes to domestic oil production is that no-matter what we do, we will not see any oil or gas for around five to ten years from new drilling projects. It has been almost five years and where are we? Back in the same old spot.
If the Obama Administration is concerned about creating jobs or helping the economy to recover it should be very worried about rising gas prices. Discretionary spending that may be helping any recovery will certainly disappear with rising prices. Small business that may have stopped laying off workers will have to consider further cuts when the cost of operating their vehicles or producing products doubles due to rising crude oil prices.
The new congress is off to a good start – cutting spending and following through on campaign promises. Hopefully we can convince them that there is room in the agenda to again bring domestic energy production back to its rightful place of importance. Not only should we be drilling anywhere and everywhere for every last drop of oil and gas but we should be mining coal as fast as we can use it and actively pursuing new nuclear power plants. Rising gas prices are never a good thing – but let’s at least learn from the experience, and take advantage of the political momentum. Remember the famous words of Rahm Emanual: “Never let a good crisis go to waste.”

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