Archive for the Gas/Fossil Fuel Category

On Freedom and Liberty (May 24, 2010)

Posted in Bailout/Bribe, Energy, Gas/Fossil Fuel, Government Regulation, Less Government Regulation Series, On [Traits/Characteristics] on May 24, 2010 by e-commentary.org

. . .

F          “Freedom and liberty are easy to define and difficult to protect and balance.  Assign Mill on Liberty.  That is the run of the mill solution.  Yet freedom and liberty are much more complex in practice.”

L          “Who constrains your freedom and liberty?  If prices are controlled by the government, are you free?  If prices are controlled by a private monopoly, are you free?  Monopolies from Microsoft to Monsanto are greater threats to our freedom than the not infrequent bumbling actions and inactions of incompetent and officious government officials.”

F          “I have a beef with four beef producers controlling the price and quality of beef.  From what I read, every major industry in America is monopolized.”

L          “Which constrains our freedom and liberty.  The chance, albeit slight, of restraining the monopolies and protecting our freedom requires government involvement.  That realization is the beginning of frustration.”

F          “And a few private sector monopolies own Congress and thwart any possibly effective legislation.”

L          “A generation ago, then-Senator Philip Hart of Michigan worked to break up monopolies and confronted Texaco, the oil company, who asserted in ads:  ‘We’ve been working to keep your trust.’  They worked hard and kept their trust.  Those oil companies have their own special charm.”

F          “How do we regulate the financial institutions that are ‘too connected to fail’?  They limit our freedom and liberty.  Lehman deserved to fail and was allowed to fail in part because Paulson did not like Fuld, the President of Lehman.  Washington Mutual deserved to fail and was allowed to fail in part because a West Coast bank is not among the East Coast players.  The other institutions deserved to fail and yet were bailed out.”

L          “It is not pretty or easy.  Why not limit the size of every financial institution to 100 billion dollars?  There are no economies of scale above that limit and many benefits from more players.  Any financial institution with more than 100 billion in assets is a direct threat to our freedom and liberty.”

F          “Great, but the financial sector will veto it.  And regardless of what Congress directs, the regulatory agencies are captured by those who are intended to be regulated.  Investment banks and others realize that no investment pays a greater return on investment than purchasing a piece of a politician.  Money invested in R&D or in HR or in PR does not come close to providing such a handsome return.  Purchasing an entire government agency is cheap and tax deductible as a business expense.”

L          “It is not easy or pretty.  You are doomed if you do and doomed if you don’t.  On the other hand, when the invisible hand begins to backhand the people, the heavy hand of the government is often the only recourse.”

F          “On the other hand, it seems that the government comes around when it is not needed and is not around when it is needed.”

L          “It is not pretty or easy.  I have worked for years with some agencies that are useless.”

F          “Need I say more.”

L          “I would like to see private sector initiatives such as the Young Americans For Freedom allying with the Innocence Project to protect freedom and liberty.  The white boys are too fixated on limiting taxes on their greens fees when they should be concerned about freedom and liberty for those who are black, brown, red, yellow and ivory.”

. . .

[See the “e-ssay” dated Mar. 26, 2007 titled “Who Is Your Big Bad Bogeyman?” and dated Sept. 4, 2009 titled “The Meltdown Continues, Subtly.”]

Bumper stickers of the week:

Freedom is not free so pay your taxes and shut up

Boycott Arizona

Drill, Baby, Spill (May 17, 2010)

Posted in Antitrust, Energy, Gas/Fossil Fuel on May 19, 2010 by e-commentary.org

. . .

“Long before the oil tanker EXXON VALDEZ ran aground in 1989 in Prince William Sound, the maritime pilots and local fishermen knew and protested that a tanker would run aground.  No doubt about it, they warned.”

“The tanker was caught between a rock and a hard piece of ice.  The rock was less forgiving; the rock did not forgive.  There were also warnings about deep drilling in the Gulf of Mexico.  The damage may be far worse than suggested.  And the by-product of the same arrogance.”

“Arrogance and avarice are the two companion killers.  Oil companies are so diabolically ironic.  Exxon once was called ESSO, the ‘Eastern Subsidiary of Standard Oil’ or the phonetic pronunciation of the letters ‘S’ and ‘O’, so that no one would forget that it had been part of the great oil monopoly Standard Oil.  Before that, the company was known as ‘Humble Oil’ to remind the public of its humble manner.”

“BP had been doing an effective job of appearing green.  Although if you think about it, it looks like the British Polluters made all the decisions to maximize the green.”

“I am also afraid that we need to continue exploring for dead compressed dinosaurs in the short term.  Drilling on American land or in American waters does make the country less vulnerable to foreign suppliers.  Drilling within an American jurisdiction is more likely to result in the oil company being compelled to internalize the ‘externalities’ which are all of the costs of production.”

“Externalities?  I’m not quite with you.”

“The company may be required to pay for anti-pollution safeguards and the actual cost of labor including safety measures and the like.  Foreign operators are even worse because they can totally disregard health and safety concerns.”

“Except when domestic operators have enough stroke to avoid paying and complying.”

“There are no guarantees.  O’Bama’s recent statements about opening coastal areas to drilling are also ironic.  He is trying to develop a realistic and balanced energy policy.  The oil industry did not do much to help the case.  And look at you.  And me.  Before this day is concluded, I will drive my car with the ‘Support the Terrorist Tax’ bumper sticker on a trip that may not be necessary.  I am voting on drilling.  If not here, then there will be drilling somewhere.”

. . .

Bumper sticker of the week:

Drill, baby, spill.

Less Government Regulation Series: The Terrorist Tax Again (August 3, 2009)

Posted in Automobiles/Automobile Industry, Energy, Gas/Fossil Fuel, Less Government Regulation Series, Taxation, The "Terrorist Tax" on August 3, 2009 by e-commentary.org

July, 2008:   Gas:   over $4 a gallon   Toyota Prius Hybrid Car:  $3000 over MSRP (Manufacturer’s Suggested Retail Price) and a line of buyers occupying the showroom.

July, 2009:   Gas:   under $3 a gallon   Toyota Prius Hybrid Car:  $3000 under MSRP and a flotilla of the cars littering the car lot.

The Volkswagen tdi (turbo diesel injected) cars followed the same price arc in response to the price of diesel.

The market should maintain its central role in American society.  Embrace it.  Taxing gasoline/diesel at a “quarter a quarter” per gallon contemplates a twenty-five cent ($.25) increase in the tax on fuel each financial quarter (90 days).  [See the “e-ssay” dated December 18, 2006 entitled “Pass The ‘Terrorist Tax’”]  As a compromise, raise the tax twenty-five cents a year every year.  Any tax by its nature contracts the economy which in this situation is akin to the body politic sucking in its stomach a little.

Implementing the tax while the market price of fuel is low is timely and crucial.  The market is ready.  More Prius cars will be built without the government passing legislation requiring more Prius cars.  More resources will be invested creating a more improved hybrid car or a new more efficient car without further government directives to create improved and new vehicles.  Although not fundamentally a revenue-generating measure, the tax funds can fill the fisc and reduce the country’s dependence on Chinese money.  So many other positive economic changes will result without any further government action.

O’Bama must deliver a speech on the proposal as compelling as his speeches in Philadelphia and Cairo.  He can sell it.  Writing the speech would be fun.

The Cars Allowance Rebate System (CARS), the “Cash for Clunkers” Program, is a short-sighted, expensive and misdirected use of government resources and misuse of public resources.  Too much government money is being spent to spew vehicles on the road that require substantial resources to produce and consume substantial resources to use.

Bumper stickers of the week:

25 cents a quarter

Stop funding terrorists

Seeding Pollution From The Heavens (February 2, 2009)

Posted in Aviation, Gas/Fossil Fuel, Global Climate Change on February 2, 2009 by e-commentary.org

Geopolitical changes opened the northern polar routes to regular commercial air travel.

Commercial aviation cross-hatches the northern skies and deposits exhaust particles from on high.

Exhaust particles create a black shroud on the white snow and clear ice.

The black exhaust particles absorb the sun’s heat and melt the snow and ice rapidly.

The next day, planes fly over and do it again.

Bumper sticker of the week:

Better to be on the ground and wish you were in the air

Than to be in the air and wish you were on the ground

Deflation? (November 24, 2008)

Posted in Depression, Economics, Gas/Fossil Fuel, Inflation on November 24, 2008 by e-commentary.org

Deflation seems to be the current concern.  Oil, copper and aluminium prices are down dramatically.  When the raw materials go down in price, the finished products should go down in price.  In theory, sort of.  The price of a 250 foot section of Romex wire is now almost what a 100 foot section cost a year ago.  However, prices often are sticky and ratchet down slowly.  Lower prices sound appealing, although deflation does create economic problems among debtors and consumers.

However, the old economic models may not work.  Demand is down because no one has any real money and no one will loan any real or unreal money.  However, credible reports indicate that people need to eat, house, drive, acquire plasma tvs, etc.  The system is awash in unreal money.  However, those who produce goods and provide services are not standing by ready to respond.  They are collapsing.  The world‘s economies and the world Economy are splintered and increasingly disconnected.  If you build it, they may not come.

Gas did not hit $6 a gallon by Halloween; it hit $3 a gallon.  [See the e-ssay dated May 26, 2008 entitled “$4 in June, $5 in July, ….”.]  The momentum for fuel-efficient vehicles has abated and investment in oil-producing equipment and fields has declined.  When the demand for aluminium declines, bauxite is not mined.  In the near future, everyone will compete with pockets full of unreal dollars for scarce goods and services.  Bread at $100 a loaf?  Inflation still seems to be the hidden monster.  The new Weimer Republic writ large.

Bumper sticker of the week:

WIL

Whip Inflation Later

Pass The “Terrorist Tax” (December 18, 2006)

Posted in Gas/Fossil Fuel, Global Warming, Taxation, The "Terrorist Tax" on December 18, 2006 by e-commentary.org

Tax terrorists.  By taxing gasoline.  The tax should be implemented incrementally to allow adjustments to spending and driving habits and raised enough to reduce demand purposefully.  Americans are directly financing hostile political activities because dinosaurs made the unfortunate decision to die in regions that sprouted unfriendly regimes.  Profits from the sale of gas profit some terrorists.  That must stop.

The consumption of much gas in America really does not result in the production of any goods or services; other countries consume gas to produce goods and services.  Consuming gas while driving to work results in the production of some goods and services, yet driving alone is inefficient.  Gas must be used more efficiently.  The market is the answer.

The market will respond in particular if there is certainty that the tax increase is permanent.  The higher resulting price for gas alone will spur research and investment into other sources of energy without the need to create any additional specific tax credits and deductions.  (There should be a concensus that the Terrorist Tax is not to be coupled with any specific tax credits or deductions.  Otherwise, a lobbyist will grab a representative’s ear and obtain an earmark for some pet technology that may not otherwise be marketable.)  The tax revenue can be used to address our obscene national Debt of almost Nine (9) Trillion ($9,000,000,000,000.00) dollars or for other purposes.

To his credit, Bush spurred debate by noting in his State of the Union address that America is “addicted to oil.”  “Addicted to Oil” is a documentary narrated by Thomas Friedman addressing the world’s competition for a decreasing pool of crude oil.  “A Crude Awakening – the Oil Crash,” a recent film directed by Basil Gelpke and produced by Ray McCormack, explains why the collision of insatiable demand for oil and the “limits of geology” is producing dire consequences.  Others have written about the problem; see the Internet.

Others have made the argument that taxes must be increased.  Mr. Friedman has championed the cause for years.  Dispensing credit for the idea is less important than selling the idea to the public.  Implementing the tax is economically and politically painful, yet failure to implement the tax is economically and politically fatal.  Paying a substantial tax on gas is one of the most patriotic sacrifices each one of us could make.  Convincing the American public to accept the “Terrorist Tax” will require astute and bipartisan statesmanship.  Those Americans who believe that taxes should be raised during a time of war may be the first to enlist in the campaign.  Present it as a tax that provides a double punch.  A single dollar provides a double return because we keep it and the terrorists don’t get it.

There is only one person who could pull it off in the short term.  Bush could shock the world by announcing the Terrorist Tax as a means to 1) deny funds to Terrorists, 2) confront global warming, and 3) generate much needed revenue.  The sales campaign requires an observation that some sympathetic countries provide oil to the United States; this country does not need to generate more enemies.  “Tax Terrorists Today.”