Pigs Fly -- WSJ Runs Pro-Obama Editorial

By Keith Schmitz
From the GOP House Organ:

Looks like Obama does have a plan to lower pump prices, and it is not the imbecilic drill, drill, drill...drill.

Obama is pushing for a stronger dollar, and the WSJ gives Obama points for that. Of course what the Murdock Street Journal may not like is to achieve it in part, Obama hopes to bring the budget more into balance by jettisoning the tax treats for the tax cheats.

As Woody Allen once said, "the lion shall lie with the lamb, and the lamb won't get much sleep."

Now it looks like McCain is beginning to loose his cheering squad.

Watch for more fraying around the edges.

John McCain endorses Jim Doyle's windfall profit tax

by folkbum

Remember how the right wing bloggers and the radio squawkers and Republican lawmakers all howled in laughter when Wisconsin Governor Jim Doyle proposed a windfall profit tax on oil companies? "It will never work," they said. "The oil companies will pass the costs on to us, the consumers," they cried.

Doyle's response? Basically, It will work because we say it will, and the oil companies wouldn't dare be so crass as to stiff us with the bill.

(For the record, I opposed the idea then and I still do.)

But guess who just stepped up to suggest that public shaming of oil companies is an effective deterrent? My headline gives it away:

STEPHANOPOULOS: Not a single economist in the country said [a gas-tax holiday would] work.

MCCAIN: Yes. And there’s no economist in the country that knows very well the low-income American who drives the furthest, in the oldest automobile, that sometimes can’t even afford to go to work.

STEPHANOPOULOS: But they all say that . . . the oil companies, the gas companies are going to absorb … any reduction.

MCCAIN: … they say that. But one, it didn’t happen before, and two, we wouldn’t let it happen. We wouldn’t let it — Americans wouldn’t let them absorb that.

STEPHANOPOULOS: How would you prevent that?

MCCAIN: We would make them shamed into it. We, of course, know how to — American public opinion. And we would penalize them, if necessary. But they wouldn’t. They would pass it on.

Let's see if Doyle can get McCain up here to campaign for the windfall profits tax ...

And we're not drilling offshore now because ... ?

by folkbum

If you learn nothing else today, at least learn this: The oil companies have leases right now which give them permission to drill on about 68 million acres of offshore land:

Unfortunately, President Bush and Sen. John McCain are trying to sell us on the oil companies' old argument that repealing the 27-year old moratorium on drilling in protected areas offshore will lower gas prices. Americans need to put this tired debate to rest. Our security--both here at home and abroad--depends on it.

First, the oil companies in this country now hold 7,000 leases to drill offshore, yet only 20 percent of those leases are producing oil. That is 68 million acres for which they already have the rights to drill. Nearly 80 percent of our offshore oil is already available for leasing--approximately 54 billion barrels total. They could be drilling in these areas, but they are not.

Another startling fact: In the last seven years (you remember how cheap gas was in 2001? Even when you were getting gouged on the afternoon of 9/11/01, you only paid $2.59), "permits for new oil drilling leases increased by 361 percent." If you're doing the math, that's faster than the price of a gallon of gas has increased since 2001.

Having a lot of offshore sites to drill in and handing over more drilling permits hasn't seemed to keep gas prices in check. The next time you hear someone suggest that doing more of the same will get us a different result, remind them that that's the definition of crazy. Which, come to think of it, probably explains why we hear it so much from some people these days ...

SpongeJohn GardPants and the Mythical Chinese Oil Drillers

by folkbum

(I would not have used xoff's greatest gift to Wisconsin bloggers in my title had this not been an underthesea-related story.)

A month or so ago, Vice President Dick "Dick" Cheney was rambling on about something and let slip a complaint that the Chinese were drilling up OUR OIL right off the coast of Florida with the help of Cuba, those commie bastards. Okay, that's a praphrase. Here's what Cheney really said:

Vice President Dick Cheney, in a speech Wednesday to the U.S. Chamber of Commerce, picked up the refrain. Cheney quoted a column by George Will, who wrote last week that "drilling is under way 60 miles off Florida. The drilling is being done by China, in cooperation with Cuba, which is drilling closer to South Florida than U.S. companies are."

In his speech, Cheney described the Chinese as being "in cooperation with the Cuban government. Even the communists have figured out that a good answer to higher prices means more supply."

That makes for a great story and it backs a significant aspect of the Republican philosophy of drilling our way out of the gas crisis (which John McCain, GOP candidate for president, suggests we both can and can't do). Gas prices are high, Americans are ticked off, and the dirtyhippielibrultreehuggers won't let us have OUR OWN OIL but China is taking it.

I bet you can see the problem coming. That's right--the story was just not true.

[N]o one can prove that the Chinese are drilling anywhere off Cuba's shoreline. The China-Cuba connection is "akin to urban legend," said Sen. Mel Martinez, a Republican from Florida who opposes drilling off the coast of his state but who backs exploration in ANWR.

Cheney's office even did the unthinkable and admitted that Cheney was wrong and that no, China was indeed not drilling for oil off the coast of South Florida. It's also interesting to learn that Mel Martinez is now apparently a dirtyhippielibrultreehugger,

Note the dates on those stories: The first, explaining that the story was false, was posted on June 11. It even got some pretty heavy play on the blogs at the time. So it's not to much of a surprise to learn that John Gard, career politician who lost to first-time candidate Steve Kagen in 2006, would repeat the lie in a June 4 press release (.pdf).


But it doesn't explain why, days after the lie was exposed, Gard was still walking around handing out this flier at county fairs.

Talking Points Memo got ahold of the flier (confidential to 8th CD tipsters: what am I? Chopped liver?), and made some calls. Our old friend Mark Graul dug the hole deeper:

At first, Gard campaign manager Ellen Nowak told us that these flyers had been scrapped. "We didn't print them that way," Nowak said, after the text was read to her over the phone.

Then she made the mistake of referring us to communications director Mark Graul, who confirmed the flyer's existence. But he said it wasn't about China, insisting that the "foreign nations" reference was to India, Brazil and other countries. "We now know that China are not drilling per se," Graul said, "but other foreign countries are."

Sadly, that's not true, either.

Sigh. A couple weeks before TPM had at Graul and co., the Green Bay Press Gazette, on their blog, not in the paper where it belonged, was on the case, with Gard standing by a weaselly version of the urban legend, that China was "exploring to set up" off of the Florida coast. That's not what the flier said, that's not what his campaign said when it announced its energy plan ( the references to China have not even been scrubbed from his website!).

It's a simple thing, John. Just man up and say, as the vice president did, that you were wrong. That you bought into a Republican urban oil myth (like the one about Katrina not causing any oil spills) and that you're sorry. It's not hard.

By all means, drill

by folkbum

Here it is in a picture:

If you think this is a frickin' panacea, knock yourself out. I'll be busy supporting a candidate with a real energy policy.

(Via.)

Oh, and lots more here.

John Gard, et al., don't get it (and they have their facts wrong)

by folkbum

In my Janesville post below, I never offered up drilling ANWR (or offshore, or oil shale, or whatever) as a way to solve GM's problems--nor did I offer up the environmentalists and others who have blocked ANWR exploration as potentially at fault. A couple of commenters noticed the oversight.

But I left it out for two main reasons: One, suggesting a supply-side fix for our inevitable fossil-fuel decline is classic denial. When you keep doing what you have always done you will always get the same results. Two, there's just not that much oil there:

Drilling for oil beneath the pristine tundra of the Arctic National Wildlife Refuge would do little to ease world oil prices, the federal government's energy forecasters said in a new report issued in a week that saw oil surpass $130 per barrel for the first time.

Congress has fought bitterly for years over whether to allow oil companies access to the Alaska refuge's 1.5 million-acre coastal plain, a habitat for seabirds, caribou, and polar bears. Oil company executives, called to Capitol Hill for a grilling over high oil prices, pointed to the untapped resources of ANWR and off the U.S. coastlines as evidence that Congress was as much to blame for the tight global supplies of crude as the petroleum industry.

But the U.S. Energy Information Administration, an independent statistical agency within the Department of Energy, concluded that new oil from ANWR would lower the world price of oil by no more than $1.44 per barrel—and possibly have as little effect as 41 cents per barrel—and would have its largest impact nearly 20 years from now if Congress voted to open the refuge today.

At $1.44 less per barrel, gas prices would fall seven cents a gallon.

John Gard, who is trying again to beat eighth-district Rep. Steve Kagen, showed he doesn't get it, either:

In remarks at a Green Bay news conference, Gard this afternoon cited "the United States Congress" as the main obstacle to lowering gas prices. [. . .]

Gard's plan calls for more drilling in the Arctic National Wildlife Refuge in Alaska, something Kagen has opposed, as well as more off-shore drilling and development of "shale oil sites" in western states. He also advocates cutting "red tape" on oil refineries.

The whole deal with oil shale is that it's only profitable when oil prices are high. And the refinery tale that he's spinning is a flat lie:

One reason for the drop in the number of U.S. refineries is that the petroleum industry began shutting down older, inefficient refineries and concentrating production in more efficient plants, which tended to be newer and larger.

Consolidation within the industry has also played a role in refinery operation. For example, the merger of Gulf Oil Corporation into Chevron Corporation in 1984 led to the closing of two large refineries, one in Bakersfield, California, and the other in Cincinnati, Ohio. In 1998 Exxon merged with Mobil Oil and BP merged with Amoco. BP Amoco then bought Arco in April 2000 to create the world's largest non-OPEC (Organization of the Petroleum Exporting Countries) oil producer and the third-largest natural gas producer. In the May 2004 article "Effects of Mergers and Market Concentration in the U.S. Petroleum Industry," in GAO Highlights, the General Accounting Office noted that "over 2,600 mergers have occurred in the U.S. petroleum industry since the 1990s."

All that "red tape"? A lie:

From 1975 to 2000, the U.S. Environmental Protection Agency (EPA) received only one permit request for a new refinery. [. . .] A congressional investigation uncovered internal memos written by the major oil companies operating in the U.S. discussing their successful strategies to maximize profits by forcing independent refineries out of business, resulting in tighter refinery capacity.

The oil companies aren't falling over themselves to build new refineries because keeping tight reins on the supply is what keeps prices high. The blame for tight refinery capacity lies squarely at the feet of the oil companies themselves.

But the widespread use of these red herrings--ANWR, oil shale, refineries, ocean-killing coastal drilling--suggests, again, mass denial among conservatives from bloggers to candidates for Congress. The American experience of automobiles (and energy generally) is done. It must change. The Republicans are falling further and further into the past, further and further into irrelevancy. It's why Gard will lose again in November, why McCain will too: It's time to lead, which implies a certain amount of going forward, not backward. And it would help if they stopped lying.

Who Killed Janesville?

by folkbum
Post title patterned after this film, which I have not seen, but have heard good things about. And it's narrated by President Bartlet.

I hope, of course, that Janesville recovers from the blow it received today. I spent five years in Rock County and I know how GM's plant there is the lynchpin to a whole lot of that economy. If another manufacturer doesn't come in and utilize that talent pool, well, I don't know what will happen. Let us all hope for the best.

But the question remains: What did in the Janesville GM plant? Seems to me there are, perhaps, a handful of reasonable suspects:

1. The oil companies. For many years, Big Oil and Big Auto have had a sick, almost incestuous relationship; cars would only run on gas and gas would stay cheap enough to keep people buying cars. The 1990s was perhaps the worst of it: Not only did GM sell key electric car technology to the oil industry (where it never saw the light of day again), gas prices in the U.S. stayed ridiculously cheap in the midst of a mondo economic growth spurt. Suddenly everyone had more money--or at least felt flush, since we were told the market was never going to go down again (Dow 36,000, anyone?). The answer: Bigger cars. For Janesville, a boon. For oil companies, a massive boon. But it was an illusion. And as soon as the SUV lost the consumer juice to the hybrid--and Big Auto started chasing that ball--Big Oil bailed. With profits like it's making now, the oil sector could easily roll back prices a little, even a moderate amount. But they won't--the market will bear $4.25 a gallon, and that's what they'll charge. (Which, ultimately, is why a gas-tax holiday is a dumb idea: You'll pay the same for a gallon of gas, but the part of the price that used to pay the bill to fix the roads will instead boost Exxon-Mobile's third-quarter profit.)
   
   
2. George W. Bush. Why not? There can be little doubt about two things: One, the war in Iraq has not done a thing to stabilize the world oil market. Sure, it didn't really fall apart as soon as the first tanks rolled into Baghdad, but you have to admit that the rise of Iran, the lack of the promised Iraqi oil, and the general antipathy with which the rest of the world now view us is not helpful in the least. Two, the present administration has done nothing to promote alternative source of fuel, alternative sources of transportation, or greater responsibility among automakers to provide higher efficiency vehicles.
   
   
3. Ronald Reagan. Yeah, I'll go there. When the CAFE standards were relaxed in 1985--and the tradition of halting increases was begun--the stage was set for the absurdly low-mpg SUVs that ruined Detroit. As long as I'm at it, I'll add in the Republicans and Michigan Democrats throughout the 1990s that refused to reclassify the SUV as anything other than a truck, which is what gave GM and Ford such license to make inefficient monsters for so long.
   
   
4. GM. GM was slow, slow, slow to catch on that efficiency was going to be the key to success in this century. GM has locked itself into old facilities (it cannot afford to build new ones), sometimes, as in Janesville, literally locked in because of the life that has grown up around the plant over 90 years. It is too big, with too many products (including legacies that should be put to pasture), and, like the Titanic, too big to dodge the iceberg.
   
   
5. Unions, NAFTA, and taxes. I put these together because they are weak candidates, and, even taken together, they cannot compete with the top four here. GM didn't close its Janesville plant because Wisconsin taxes are too high (I haven't even seen that suggested, though I thought it would be Talking Point A on every conservative blog today). NAFTA didn't save GM's plant in Toluca, did it? And the unions didn't crush GM either. It may well be that the typical American-made GM car has more labor costs in it that the typical American-made Toyota, but wait a few years until Toyota's employees start retiring and see what happens then. Besides, what's killing the SUV is not its sticker price, but rather the price at the pump.

Ultimately, I'm not sold on any one of those, or even all of those in combination, as what killed Janesville.

I think it's us. I think we did it, the zeitgeist, the ethic, the Culture of the Car that is so ingrained into us that "What do you drive?" is a fairly common getting-to-know-you question. It's the nagging suspicion that people who ride the bus are poor and will rob us if we get on there with them. It's our representatives who see only lanes, lanes, lanes, and not a track to be had. It's the rules that require big lots and far-away shopping, rules that we demand because, well, we have a car, so what's the harm? It's the belief that whatever happens everywhere else, America will be just fine. When you live by the car, you die by the car. God bless you, Dwight D. Eisenhower, indeed.

General Motors could never have been born in any other place, among any other people. In the end, we also killed it.

They're Going to Pump You Up

By Keith Schmitz

Brace yourself.

CNN announced this morning that BP has discovered “severe corrosion” in their pipeline leading out of Alaska’s Prudhoe Bay. They will be totally shutting down that flow of oil for pipeline repairs.

This is the US’s largest oil field so folks, the pain is coming in the form of yet another jump in oil prices. This is 8% of our oil supply and according to an oil analyst the increase will be five cents to a barrel of crude. Expect once the middle-men get their cut a multiplier will kick in on that figure.

It is predicted the repair to the pipeline will take weeks, perhaps months.
The question here: is this what the tax cuts our Congress happily handed over to the oil companies have bought us? What are they doing with the money? You would think pipeline maintenance would be one of the routine benefits that would have come out of this donation from you, the taxpayer, who will have to make it up by paying the interest that this contribution to the deficit will make down the road or more cuts in vital services.

Makes the mind wander as to where that money really went.

The timing could be good or bad for the oil companies depending on how you look at it. Fortunately for the oil companies Congress is in recess and the hearings that could have come out this would have been more bad publicity for the oil barons. I say could because our Congress has basically slept through its job of oversight.

Of course this is where the bad timing part comes in. The yet higher gas prices may quite likely inspire voters in November to put people in Washington who will do the job of oversight. You know, what a member of Congress is hired to do. Hear that Jim Sensenbrenner?

If our friends over at the right wing blogs pick up on this coming wave of higher prices, they of course in their usual spirit of “thank you sir, may I have another sir” will be cooking up all sorts of sonorous arguments in their pseudo-learned tones, lecturing us about the intricacies of oil price hikes. In less academic terms. BS.

Trouble for them is that most of the public doesn’t read political blogs, and their defense of the oil companies will be drowned out by the sound of that tank of gas going through the roof.

Bear in mind it wasn’t really Woodward and Bernstein that brought Nixon down. It was gas at over a buck a gallon.

The first step is admitting you have a problem

And folkbum's rambles and rants alumnus Tim Schilke takes that step:

Now that I finally recognize my addiction and the harm it has done to my country and to the world, I’ve decided to follow a 12-step program toward recovery. Traditionally, the first step is for me to admit that I am powerless over my addiction, and that my life has become unmanageable. I can admit that now. Although in my situation, unsustainable is a much better word. [. . .]

The second step of 12 requires me to believe that a power greater than myself can restore me to a state of sanity. Fortunately, my sanity was restored last week, when President Bush visited Milwaukee to remind me of my addiction.

What is he addicted to? And how can Bush help him? You'll have to read the rest to find out.