Skip to comments.Energy Independence II ( John Stossel still doesn't "get it!" )
Posted on 08/27/2008 6:32:39 AM PDT by kellynla
John Stossel sounds like a real defeatist. ... We have our backs to the wall, and he's raising the white flag."
"Stossel has lost his mind."
My column last week mocking "energy independence" angered people.
I argued that "independence," a favorite slogan of vote-hungry politicians, would require the government to interfere with the global division of labor, which, as economists have understood since Adam Smith's day, make us richer and therefore better able to deal with the future uncertainties. "It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy. ... If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them," wrote Smith.
Of course, as many readers noted, the federal government, by doing things like prohibiting drilling in on- and off-shore areas that may have oil reserves, makes it more expensive or even impossible to produce energy in this country. Those policies should go, but that would still not bring self-sufficiency. Our demand for oil is too great.
And anyway, if the economics of oil production favor foreign over domestic producers, it still makes sense to buy the cheaper product. It wouldn't matter how much shale oil we have in the United States.
Readers correctly point out that because governments control much oil production, there is no global free market. But it does not follow that market forces don't work. There are many sources of oil in the world and many buyers. Supply and demand still set the price globally. It is foolish not to buy at the lowest price.
But one that stands out is "When we trade dollars to foreigners for oil, they have to do something with those dollars." Yes, John, many of those countries that we purchase oil from use the proceeds to purchase arms to kill American Soldiers, Sailors, Airmen & Marines!
Sheesh...Stossel get a grip!
We're paying for the WOT on BOTH ENDS!
He’s absolutely right on all counts.
THIS I gotta hear!
A bit of economic distortion calculated to (in the short run) reduce the revenue to hostile regimes and (in the long run) replace oil-based fuels altogether so that these regimes would have their air supply choked off is definitely the lesser of the two available evils.
Maybe you can clue us in on how we can extract ourselves from the world economy without plunging us back into a pre-industrial revolution life style.
You grossly underestimate the distortion we are talking about.
try answering my question first...
Most of the money goes to Canada and Mexico. What about the huge trade deficit with China, which in turn, invests much of it into US T-bills? Stossel gets it.
“Stossel gets it?”
Okay, Marine, you wanna address the issue in my first post.
It is the cost of living our lifestyle. Try living a subsistence lifestyle for a year then tell me if it’s worth the cost.
America already buys only a smaller percentage of oil from the Middle East. In order to de-fund Islamic states, you must also convince the rest of the world to stop buying from them.
If you add the military budget to protect ourselves from states with oil (Russia, Iraq, Iran, Vennie and so on) to the price of oil, suddenly solar power starts looking a little more attractive.
Mideast oil will be sold... to someone. If the U.S. refuses to purchase it, some other country (China?) will. The funds will still go into the Mideast whether we buy the oil or someone else buys it.
Its not the distribution pattern, its the global price of oil that causes the problem. To lower the price, ultimately global demand needs to drop. We can do part of that by funding alternatives, especially nuclear power for electric transportation (trains, battery hybrids) but also other alternatives too.
but the price might drop if we produced more here, and used less
True, but Stossel does not argue against drilling here. His argument is that it is in our best interest to buy at the cheapest price, whether the oil comes from here, Canada or the Mideast.
Oil is a global commodity. All oil is fungible. Whether we buy it or not doesn't matter since oil is a commodity in high demand. These "proceeds" will be available to the producers regardless of where we spend our money.
Canada is our biggest trading partner. 23% of our exports go there and 17.4% of our imports come from Canada, followed by China 13.3%, Mexico 10.6%, Japan 8.8%, and Germany 5.2%.
What specific countries are you referring to in terms of oil purchases that help fund terrorists? Here is a list of countries we import oil from and the amounts
“It is the cost of living our lifestyle?”
Yea, well I tell ya what, the next Marine’s funeral I attend, you can come along and tell that line of BS to the widow & orphans...
“Try living a subsistence lifestyle for a year then tell me if its worth the cost?”
If it means dead & maimed Soldiers, Sailors, Airmen & Marines, it is definitely NOT “worth the cost!”
And if you had served and/or lost a loved one in combat;
you would know better than to make such an outrageous comment!
Finally, FYI, there is absolutely no reason on earth why we can not only “subsist” but PROSPER without trading with countries who are our enemies...let us all know when you “get it!”
He is absolutely correct.
I didn’t know anyone in the media actually understood this fact. It seems there’s at least one.
It is despicable that you use the ultimate sacrifice of solders as a prop in your political rant.
Nice appeal to emotion there.
That’s exactly right, and Stossel would likely agree. We should absolutely drill to lower the price, but insist on independence from Mexican and Norwegian oil? No.
Drill Here - Drill Now
We need a vote
Nazi Pelosi AmericanVoices@mail.house.gov
We need emergency session
President Bush firstname.lastname@example.org
John Boehner invited McCain to join them
McCain needs to get his a$$ to Washington where he belongs
It will bring the much needed media attention
“What specific countries are you referring to in terms of oil purchases that help fund terrorists?”
just the facts, ma’am...
No, it’s an appeal to emotion and ignores economic reality.
“ignores economic reality?”
Maybe in your world. LOL
I think y’all are comparing apples and oranges. We don’t buy oil from the Arabs. We buy petroleum based products from companies that do business with the Arabs. Is that us funding terrorism? Actually, yes.
I guess you can look at it that way, same way you can look at an American company like General Dynamics with so many thousands of employees selling military equipment to our enemies or to countries that do business with our enemies. My god, an American company selling equipment to our enemies so they can kill us? Maybe we should just shut them down?
The global miltary/industrial complex is so intertwined that changing one variable can have a significant impact on millions of lives both domestic and foreign.
Not understanding the business of big oil I can only surmise that the only option for us not to give “oil money to the Arabs so they can buy weapons and kill us” is to kill off oil in the commodities market, nationalize the oil industry and have a dept of drilling and we drill for our own consumption. In addition, any company that produces any product that has military use and can be used by a foreign nation in killing Americans should be shut down or forced to cease selling to that country.
Of course since that goes against the principles of capitalism it sounds like something the RATS would prefer us do.
So you are living a life without oil? If you are using any oil or products derived from petroleum, you are part of the problem you pose.
We can undo the world economy I guess. It would be a major mistake that would bring crushing economic ruin to the world. If that is what floats your boat, the “chosen one” will get you there quicker.
Standing on the backs of our soldiers to claim the moral high ground to pound your point of view is in poor form. It’s OK, the soldiers are used to it.
What is “despicable” is that you say others must sacrifice their lives and families so that YOU may live your “subsistence lifestyle.”
“It is the cost of living YOUR lifestyle
your words not mine...
“So you are living a life without oil?”
No,the point is that the more we drill at home the less we are dependent on and contribute to countries who are our enemies.
The Saudis have helped us behind the scenes in stablilizing oil prices and supplies and acted as a useful conduit for funds whether it was fighting the Soviets in Afghanistan or the Contras in Nicaragua.
FYI: I spent five years in the Kingdom [1987-1992].
They’re all volunteers. God bless ‘em all.
Stossel is absolutely right. Look up the word “fungible” and get back to us.
People don’t get that. There are lot “let’s all suffer for the greater good” types here.
BUT, they are funding RADICAL mosques around the world. It isn’t all black and white with the Saudis, it’s a dark shade of gray.
If I had a magic wand I’d invent an energy source that would make their black sludge worthless over night. But we live in the REAL world.
It is not black or white with the world, not just the Saudis. Whether people like it or not, Saudi Arabia has the largest proven reserves of exportable oil. Saudi Arabia and the region are absolutely critical to the global economy. We must keep an uninterrupted flow of oil from the region or suffer serious consequences. Demonizing Saudia Arabia is counterproductive and ignores our geopolitical and strategic national interests.
Oil will remain the dominant energy source for decades to come. That is just a reality.
And further more, if we use only domestically produced energy, our energy costs will go sky high; while the rest of the world, including our enemies, will be able to purchase it even cheaper (since the biggest purchaser is no longer buying).
Energy is an economic input- if the USA is forced to spend 2-3 times as much as everyone else for the same input; we are going to suffer way more than any suffering we could inflict on them.
The oil market in general is a finite market. If we boycott Venezuela’s production let’s say...and buy only from our Norwegian Allies. Whoever was previously buying from Norway will then turn around and buy from Venezuela, so the effect is the same whether or not we buy from them.
So the argument that we are “funding our enemies” or “funding the spread of Islam” doesn’t pass the smell test. If we choose to use only our own domestic supply...we pay more for the production, depleting our cash and our natural resources while dropping the price of crude internationally as well.
Islam needs to be fought ideologically, psychologically and militarily...but where we buy our oil doesn’t offer an advantage or disadvantage to that end in my opinion.
>>Hes absolutely right on all counts.<<
I concur. I was expecting to see something shocking in this article. Nothing there that I don’t agree with though.
>>Maybe you can clue us in on how we can extract ourselves from the world economy without plunging us back into a pre-industrial revolution life style.<<
As long as we can keep indoor plumbing and avoid the nasties like Polio, I’m down with that!
Oh, and I want to keep my mountain bike. And I really need Google. And I like my electric basses and amps.
>>It is the cost of living our lifestyle. Try living a subsistence lifestyle for a year then tell me if its worth the cost.<<
I’m with you. I like to camp, but not for more than a week or so. ;)
I like to bike commute, but only because I don’t HAVE TO, like so many in other countries.
I had heard several years ago that once oil got to $30 a barrel, it would be cost effective to extract from the oil shale in Colorado.
I take it that was just what in sales is called a BFC (Big Fat Claim) with no real evidence to support it.
That post makes no sense. At least not from an historical US perspective.
In short, the bumper sticker-sized synopsis is; The US cannot support it's global leading GNP with the energy we have at our disposal within our borders, and the global economy wouldn't allow for it.
Also, the author spends a lot of time blaming the Jews,....errr, I mean Neocons.
>>Stossel still doesn’t “get it!” ) , DManA wrote:
BUT, they are funding RADICAL mosques around the world. It isnt all black and white with the Saudis, its a dark shade of gray.<<
I remember that the Soviet Union was our “ally” during the second world war. It did the job.
Geo-politics is more complicated than some would have you and me believe.
Shell claims that their in situ retorting process would be cost effective at $30/bbl. After adjusting for inflation and salesman's hype, I think $60/bbl would be a good estimate for profitable extraction. The whole thing is still stalled by being wrapped up in government (read "environmentalist democrat") red tape.
There is enough kerogen recoverable using current technology to supply the entire current US demand for oil for over a hundred years.