Obama on Gas Prices: Suck it Up

Back in 2008, when Hope'n'Change (TM) was all the rage, then-Senator Obama was a little more honest about his energy policies.

Monterey Park, CA (LA Times)

USA Today reports that gas prices average $3.83/gal for regular gasoline nationwide, but for about 1/3 of Americans, they've already crested $4.00/gal.  Fortunately for us, Kansas - a petroleum producing state - has lower gasoline prices than the majority of the country.  The last time I bought Diesel it cost us $3.96/gal.

What does Pres Obama say now about how his energy policies affect prices?



Essentially, "It's not my fault.  I'm doing everything I can to keep gas prices low for you".  Pretty different tune, right?

By the way, Pres Obama's oft-repeated trope that "we only have 2% of the world's proven oil reserves" is a lie.  Either that, or he's ignorant of the facts.  Take your pick.  According to a report published in 2008 by the US Geological Survey, the Bakken Formation of North Dakota and Montana contains "3.0 to 4.3 billion barrels of undiscovered, technically recoverable oil... a 25-fold increase in the amount of oil that can be recovered compared to the agency's 1995 estimate of 151 million barrels of oil."  The RAND Corporation published another study in 2008 stating that:

The largest known oil shale deposits in the world are in the Green River Formation, which covers portions of Colorado, Utah, and Wyoming. Estimates of the oil
resource in place within the Green River Formation range from 1.5 to 1.8 trillion
barrels. Not all resources in place are recoverable. For potentially recoverable oil shale
resources, we roughly derive an upper bound of 1.1 trillion barrels of oil and a lower
bound of about 500 billion barrels. For policy planning purposes, it is enough to
know that any amount in this range is very high. For example, the midpoint in our
estimate range, 800 billion barrels, is more than triple the proven oil reserves of Saudi
Arabia. Present U.S. demand for petroleum products is about 20 million barrels per
day. If oil shale could be used to meet a quarter of that demand, 800 billion barrels
of recoverable resources would last for more than 400 years.

So, why is Pres Obama still repeating this lie?  Simple.  The tiny percentage of our available petroleum and gas reserves to which he allows access only amounts to 2% of the world's known reserves.  So, when Pres Obama brags about increasing oil production in the US, keep in mind that he and his fellow Democrats continue to prevent far greater exploration.

What about all the "investments" Pres Obama brags about in his weekly address?  Does the word "Solyndra" mean anything to you?



How about Beacon Power Corp, or EnerDel?

Take, for instance, Beacon Power Corp., the second recipient of an Energy Department loan guarantee in 2009. In March 2010, the Massachusetts energy storage company paid cash bonuses of $259,285 to three executives in part due to progress made on the $43 million energy loan, Securities and Exchange Commission records show. Last October, Beacon Power filed for Chapter 11 bankruptcy. 

EnerDel, maker of lithium-ion battery systems, landed a $118.5 million energy grant in August 2009. About one-and-a-half years later, Vice President Joe Biden toured a company plant in Indiana and heralded its taxpayer-supported expansion as one of the "100 Recovery Act Projects That Are Changing America." 

Two months after Biden's visit, EnerDel corporate parent Ener1 paid $725,000 in bonuses to three executives -- including $450,000 to then-CEO Charles Gassenheimer, who led Biden on the tour. This January, Ener1 filed for Chapter 11 bankruptcy protection. 

In fact, the Government Accounting Office reported that 85% of the Department of Energy's "investments"  granted and committed under their "Loan Guarantee Program — $30 billion in all — shows systemic mismanagement, uncompleted reviews, missing documentation, and a process failure rate of 85% or more".   


What about all those wonderful electric cars Pres Obama touts constantly?



But it gets worse than ABC reported.  According to CNN:

Fisker Automotive, the electric car company that received $528 million in Energy Department loan guarantees, announced layoffs at its Delaware production facility on Monday.
...
"We have temporarily delayed work at the plant based on ongoing discussions with the DOE regarding funding for the Project Nina program. As a result, we have laid off 26 people," the company said in a statement Monday. 

I love Fisker's quote in the video.  "We're not in the business of failing, we're in the business of winning, that's why we make the right choices for the company, that's why we went to Finland."  That's great, Mr Fisker.  I fully support you doing what makes your company most profitable... with your own damn money!

And note how EnerDel and the Fisker plant in the US went to Delaware - VP Biden's home state.  It's almost as though all this "investing in green technology" is nothing more than crony capitalism.  Say it ain't so, Joe!

Check out what happened when Consumer Reports bought a Fisker Karma to test.



Then there's the biggest case of crony capitalism in history - General Motors.  Pres Obama wants to increase the tax incentive to buy a Chevy Volt from $7,500 to $10,000.  Here's a silly question.  If the Chevy Volt is such a wonderful, desirable vehicle, why does the Federal Government need to pay people $10,000 to buy it?  Because, as The New York Times explains:

The credit’s enhanced value would bring the purchase price of alternative-energy vehicles more in line with conventional models, supporters say. Partly because of the vehicles’ costs, sales have been a problem. General Motors announced last week that it was suspending production for five weeks of the Chevrolet Volt, a plug-in hybrid that Mr. Obama has promoted in the past. 

And as Tina Korbe explains:

So, supporters admit that, right now, the benefits of alternative-energy vehicles don’t yet outweigh the costs to consumers. To the producers of such vehicles, I say: Tough luck. The onus is on them to produce a product that consumers actually want to purchase at a price they can afford. Tax credits might give consumers more reason to purchase the vehicles, but it won’t give the producer any incentive to look for cheaper ways to manufacture them. The president’s tax credit ensures that taxpayers will continue to pay an arbitrarily high price for the vehicles long after the market would have brought costs down. 

That's the story with all of Pres Obama's "green tech investments"; risking your money and mine on long shot gambles.  Did you authorize those gambles?  I didn't.

Worst of all, these "investments" amount to subsidizing the wealthy.  The Fisker Karma and Tesla Roadster both cost over $100,000.  Can you afford a $100,000 car?  I can't.  The average Chevy Volt owner's income is $170,000.  Do you make $170,000/year?  I don't.  Yet you and I are paying $10,000/car so that someone who makes $170,000/year will buy one.

Does that make sense to you?

I oppose all subsidies for private industry.  Private companies should stand on their own profitability or not at all.  That includes energy companies.  We need energy to do absolutely everything we do in our economy - buy, sell, ship, store and/or provide goods and services.  So if our energy sources are not economically viable, our entire economy can't be economically viable.  Ed Morrissey Puts it well:

I like Ace’s approach to technological development:

I prefer the “Old” approach to emerging technology: We adopt new technology when it is better and cheaper than the old technology, not when it is worse and more expensive, forced to convert over by a government demanding we pay more for less. So we can reap all these speculative benefits in a hypothetical future. 

You know what I liked best about the old approach, other than the fact that it worked; It didn’t require government to place bad bets on companies like Solyndra that wouldn’t have survived otherwise to ruin more capital and resources.  

Think about that for a moment: these government interventions cost us money whether we get more energy efficient or not. And what has it produced? Nothing of consequence, and nothing that would last once the subsidies that make them artificially competitive now (to the extent they’ve even achieved that status) once the subsidies end. The old method of allowing capital to produce innovation and consumers to choose winners brought us prosperity and technological advancement. Obama’s has brought us bankruptcies, soaring debt, and no progress at all. That’s change, all right.

UPDATE: Fisker may turn out to be worse than Solyndra.