House Democrat(s?) Call for Nationalization of US Refineries
Posted by Prof. Goose on June 18, 2008 - 5:00pm
Topic: Policy/Politics
Tags: democrats, house of representatives, maurice hinchey, refineries, steny hoyer [list all tags]
http://www.foxnews.com/urgent_queue/index.html#a54ef44,2008-06-18 (hat tip: Drudge front page)
My impression of that report was that this was a group of House Democrats standing at a podium talking about the days' events in the House. For Rep. Hinchey to say what he did when he did could be taken as representing the opinions of the group of speakers, which may have been representing the Democratic Party at the time--and he was not corrected by the others speaking. We would need to know more in what capacity Rep. Hinchey was speaking, etc., etc.
Rep. Maurice Hinchey (D-NY), member of the House Appropriations Committee and one of the most-ardent opponents of off-shore drilling (at 1115 said): "We (the government) should own the refineries. Then we can control how much gets out into the market."
{...} House Democrats responded to President's Bush's call for Congress to lift the moratorium on offshore drilling. This was at an on-camera press conference fed back live.
{...} Among other things, the Democrats called for the government to own refineries so it could better control the flow of the oil supply.
I just sent an email to JHK, with this story. The subject line was "Exponential Growth in Delusional Thinking."
It is going to be a very interesting political season, with both parties pretending that we can have an infinite rate of increase in our consumption of a finite energy resource base.
There is of course a simple reason for the rapid increase in oil prices: Importers bidding for declining oil exports, but it's not a reason that either party wants to hear.
Big problem: there have been a few cases of refinery capacity being manipulated for profit. Yet Democrats want to seize on such examples to as proof that the larger part of the run up in prices is because of dirty capitalists rather than anything fundamental to the market. Part of the bad faith in markets downstream from Enron, and from Exxon being more concerned with propaganda than truth. Too many Democrats don't trust that business is honest about anything anymore, especially in where it finds its profits. Therefore profit itself is taken as evidence of crime.
This is idiotic. But it's what happens when businesses have too often been too dishonest, and an opposing party has few in it who deeply understand business or economics. (And I'm a Democrat saying this.)
With current crack spreads, many oil companies might be well advised to sign over title to refineries for one dollar.
Westexas,
Makes sense to me. Refineries are no longer making money, and don't look like they will in the future, and oil companies would be well suited to dump these giant fixed expenses, huge infrastructure maintenance, and money losers onto We The People for their upkeep and care. Upstream is still profitable. The oil companies are learning from/jealous of the banks--dump the losses on the backs of the people and keep the profits for the few.
Ugh. If this is true, then the debate just went from stupid to idiotic. Who stole our Capital and replaced it with the animal farm?
Edit --
Come on guys! You must consider the source. Fox News??? You'll need secondary and tertiary verification along with a de-spin doctor just to tell truth from BS.
Coming from Fox, I'd bet there's about as much truth in this as Chinese drilling 60 miles off the Florida Coast.
Rob out...
Well China is only *planning* to drill there, having bought the rights to it.
So that would make it a what ... 90% true ? 95% ?
It certainly is not a false statement that China is drilling 60 miles of the florida cost, they certainly are at 100 miles, and have "reserved the right" to drill at 60 miles.
http://ap.google.com/article/ALeqM5hwl7MBs14OAtZbu1YJe8l-X7O8vAD91906B80
You'll have read through the "weeeeiiii this can't be true" socialist drivel though.
Article doesn't quite say what you suggest. The UM "expert" they quote says "Cuba has awarded offshore oil leases, or concessionary blocs, in its offshore waters to six oil companies — none of them Chinese..."
And then the CSIS "expert" says "Sinopac, has conducted exploratory drilling on a lease on land in western Cuba, but is not involved in the offshore development."
Seems pretty clear to me. But you can continue with your "neo-con" drivel if you like.
I wrote my US Senators several months ago with this proposal. The US energy sector has been abused and has lost all credibility with US citizens. To stand by and let private individuals dictate how and gas are sold to Americans while simultaneously allowing them to corrupt our political process is wrong and is a recipe for disaster. The harm done thus far will take decades to fix.
When this administration is out of office I anticipate you will see one of the largest criminal investigations in US history. At this point there are not enough US attorneys to chase down all of the crooks...most of whom are from Texas.
What should the architecture of this new US Energy Department look like? Well it doesn't take a rocket scientist to hammer out something that is better than what we have now. Below are some of the basic elements:
1. Oil and gas refineries will be nationalized and staffed by qualified private contractors.
2. An independent, bipartisan US Energy committee shall provide transparent oversight of all US refineries and their associated activities. This committee shall be comprised of:
a) Bipartisan team from the US House and Senate
b) 2 Independent industry professionals
c) 2 Independent environmental professionals
d) 2 Appointed members of the EPA
No members of the US Energy committee shall have any vested interest with contractors, which includes ownership in stocks or other corporate assets.
3. Like other government contracts the contractors shall be required to transparently bid for work including exploration, refining and distribution contracts.
4. The US Congress shall authorize funds for exploration, imported fossil fuels, refinery maintenance and new refining capacity.
5. In the event of a national emergency the President of the United States, with the consultation of the US Energy committee, shall be authorized to spend emergency funds appropriated by Congress to address a national emergency.
6. A significant percentage of profits earned by the US Government on the sale of refined fossil fuels shall be invested in renewable energy programs backed by the US Government including solar, wind, nuclear, hydroelectric power.
7. A US Energy Truth and Reconciliation committee shall be established to address and resolved grievances brought by the public against private US energy contractors and their subsidiaries and affiliates. When criminal activity is discovered the US Attorney General shall assign a US Attorney to investigate and prosecute in federal court.
8. For criminal cases brought by the US Energy Department against foreign companies and citizens, the International Criminal Court (ICC) shall hear each case and prosecute according to international law. If US Citizens are harmed by a foreign company or individual they shall be charged and tried in US Federal court.
Such a structure is long overdue and brings some honest solutions to Americans, our political process and the global environment. Anything less is irresponsible reckless behavior.
Being the caplist pig that I am, I shudder to think what a government run oil industry would tune into. Take a look at Mexico and see what is happening to their Pemix. The government used it as a cash cow and now they don't have enough money to go for their GOM areas. They spent it all on geegaws and jimcracks to keep the fat cat politicians reelected.
9. Establish a bipartisan commission to determine which Laws of Nature to repeal:
http://www.glossynews.com/artman/publish/laws-of-nature-repealed-1291.sh...
Too bad that the US doesn't want to participate with the ICC (too many candidates for prosecution is the reason, I think).
I like my suggestion from yesterday. The US government should take over the refineries. Let the oil producers decide how much they want to charge for oil input and let the US citizens decide how much they want to pay for gasoline. Think how popular the government will be! The government clearly has infinite capacity for debt.
I also like Westexas' idea. Lets vote on the laws of nature. Clearly, some of the laws of nature just aren't being cooperative. We need new ones. National security is at risk (not to mention my ability to drive my SUV)!
most people are not that rational
they make decisions based on fear.
Callapse or chaos is he path of least resistance.
things more likely to get worse after the election no matter who wins.
"Nationalise the refiners"
"An independent, bipartisan" like the wonderful bipartisan CAFE standards perhaps that have been designed to allow the car companies to evade the restrictions???
"Like other government contracts the contractors shall be required to transparently bid for" like blackwater perhaps???
"the President of the United States ... shall be authorized to spend emergency funds" like the Iraq war has been funded for the last 5 years perhaps??
"A significant percentage of profits earned by the US Government" the government can't even make a "profit" from the taxes it takes to pay for the expenses!!
If this is typical thinking in the US then you are all stuffed, you must have been swallowing stupid pills by the barrel. Get real, something like 5% of the world's population is using 25% of the world's oil and you are complaining at paying only $5/gallon.
Land of the Free? I have never seen so many stupid restrictive union rules as when i had a stand in the US nor such a useless bunch and i have done this all over the world e.g. build a stand without any electric supply and at such a high price.
Re: "Exponential Growth in Delusional Thinking."
http://www.nytimes.com/2008/06/19/opinion/19evans.html?_r=1&oref=slogin
OP-ED CONTRIBUTOR
Sue OPEC
By THOMAS W. EVANS
Published: June 19, 2008
I wonder how many US corporations are in violation of other country's pollution laws? Lets just make it so everyone in the world has to obey every country's laws, all at the same time, no matter where they live.
Both the onset of peak oil and the onset of widespread idiocy are occuring faster than I expected.
Shargash - if you believe the onset of idiocy is only now coming on fast, you haven't been paying attention. We've been fully functioning idiots for quite some time now, at least since the onset of civilization ;-).
and then they stop selling oil in dollars and use euros instead.
Hi WT,
Maybe we have moved beyond denial - there's plenty of oil out there; to anger - why aren't those bastards drilling/refining our way out of this?
Next stop - bargaining; how about if we nationalise the drillers, refiners..??
For a good explanation of why we can't have continued growth of pretty much anything watch Dr Albert Bartlett, it's an hour long but well worth watching IMHO
http://video.google.com/videoplay?docid=4364780292633368976&q=Dr.+Albert...
How would government-owned refineries "better control the flow of oil supply"? I understand the logic of many of the bizarre proposals, such as coastal drilling and investigations into the commodities markets, but this time I don't even understand the logic.
Does "better enable us to enforce future rationing of oil products" sound better?
Yes. Much clearer.
No worrys!
After nationalizing the refineries, Congress will simply nationalize all the Oil companies, then the Auto and truck factories, the farms, all US companies. We'll all just become gov't employees. Whats wrong with a little social nationalism, Comrade?
Nastrovia!!
Brilliant. Just f*cking brilliant. Tell me something peeps, what is it that the current liberals are thinking? Can this behavior be explained in any rational framework? Windfall profits taxes, nationalizing the refineries, suing opec, STILL opposing drilling, STILL opposing nuclear, did ANY of our leaders even TAKE econ 101?
The windfall profits tax makes some sense. It discourages investment in pointless exploration. We would do better though to discourage that by instituting such strong rationing that we can keep ahead of both expected world production decline and demand growth elsewhere so that our transition off of oil can be done at $20/barrel. http://mdsolar.blogspot.com/2008/06/oil-is-too-expensive.html
Chris
The windfall profits tax erodes property rights. Property rights are one of the corner stones of our society. Business that purchase land and drill,and extract oil are taking a risk if things don't work out. If they do work out, then they get the benefits.
Rather than try to erode property rights as a way of justifying a failed energy policy, let's actually make an energy policy that makes sense.
Reward those companies that invest that money into the things we want with tax credits, rather than punishing them for doing what is legal.
And get rid of "giving away" government owned mineral and natural resources to private companies for low lease rates. The government should make a profit on mineral extraction from public lands, instead of treating it as a way of rewarding political contributors.
Mike
Actually, no. Taxes are are way of acknowledging ownership. They support property rights.
You'll see that I support more direct action (rationing) to remove the profit from the oil business, but it is OK to remedy imbalances using a tax. Commercial property is sometimes taxed at a different rate than residential property or church property. Commercial property can put more stress on government services, for example. Oil companies seem to be stressing fuel assistance programs just now so it can make sense to do something about that. But, the main thing is that we need to discourage exploration for oil worldwide and the windfall profits tax is not the instrument to do that except domestically.
Chris
Mdsolar, or Chris if I may,
I cannot tell if you are actually advocating the WPT or if this is sarcasm.
Why should we impose a tax on the people who own the only production we can count on, that being domestic? (Yeah, let's make the folks here at home pay and send the other 72% of the cost of the crude oil we waste daily to NOC's which support terrorism.)
Further, would you then advocate imposing a WPT on all areas of our economy which have had extraordinary jumps in profits, such as the jump in agricultural product prices, and on precious metals, and on phosphate?
Or is it some bias against the people who are somehow invested in the oil and gas industries which make you want them to support the part of government programs you prefer?
I still eat those $8.00 beans from time to time, just to be sure that I don't forget how much I sacrificed when oil prices were extremely low and nobody stepped up to help me. Ergo, why should I help you, or the recipients of the fuel subsidy programs - just because I "can"?
"Don't tax you, don't tax me, tax that man behind the tree." by Molly Ivins, then of the Fort Worth Star Telegram
Chuck
If you look at my link, you'll see that I suggest rationing rather than a tax. http://mdsolar.blogspot.com/2008/06/oil-is-too-expensive.html
Nobody expects you to help out with fuel subsidy programs at all. You are exepcted to pay lawful taxes. How those taxes are used is a different (lawful) process. I point out in the link that the windfall profits tax does not do enough to discourage exploration for oil.
I don't see why you would be upset about slim returns on oil investments. Oil is supposed to be cheap. If it isn't, it is a waste of effort. Large profits show that the market is not working to allocate our efforts to obtain energy efficiently.
Chris
Further, would you then advocate imposing a WPT on all areas of our economy which have had extraordinary jumps in profits,
Ok, the subject is 'profits'
such as the jump in agricultural product prices, and on precious metals, and on phosphate?
Now you jump to prices?
So which is it? Price or profit?
You have obviously seen the light, which was never recognized by the earlier WPT regulations which were imposed - they imposed a tax on oil production, irrespective of any profits. Then, once the government had your money, levied at a rate of approx 30% of the sales price, you could endure the tedium of getting it back by completing a stack of paperwork for each lease for each check you received for proceeds. In many cases, it doubled the administrative cost for the taxpayers. This is probably why the latest proposed levy concentrated, for now, on the five largest oil companies. They have the layers of personnel and capability to produce tons of paperwork, or hopefully e-paperwork so we can have some trees to use for fuel when the oil runs out.
It simply makes no sense to tax only the oil industry when prices rise, and leave any impression that this is a tax. A tax, in a fair system of taxation, would be levied not just on one industry but on profits, or sales, across the whole economy, or what is left of it. If we are to levy this tax on all producers, then the whole world needs to levy that tax. If it is going to be on profits, then let producers know the method to be used to make that determination, and file the returns, for all of the industries impacted, like farmers, potash producers, and oil producers, just to name a few.
If PV solar panels, SDHW equipment, and solar space heating become really popular, and extraordinarily profitable, will we impose taxes on that industry as well?
In all honesty, if this is a true party statement, both the libs and the conservatives have lost it. Republicans think they can drill their way to energy independence, Democrats think they can achieve it through government control. There's a huge leap between rational legislation/regulation and nationalization.
And why would you expect them to act any differently on this issue than they have on nearly every other issue?
We are still in the Denial stage of confronting the problems...
Tell me something peeps, what is it that the current liberals are thinking?
They want to appear to be doing something.
Can this behavior be explained in any rational framework?
A nation can withstand stupid moves like 'nationalize gas'. It can't withstand its own laws being debased.
What I don't understand is why, at this moment, people are 'upset', when there have been so many other reasons to be pissed.
"What I don't understand is why, at this moment, people are 'upset', when there have been so many other reasons to be pissed."
Maybe because this is affecting people directly and makes them change their lives?
Take as an example the funding the Iraq war, borrow money instead of raising a war tax. Hey presto no real pain there then since it's tomorrow's problem.
Got no money, no job - no problem take out a ninja loan buy a house and cash in, can't go wrong can it.
Please don't confuse your particular beliefs with truth. Argue all you want against the ideas presented, but to assume that you are the "rational" one when all those who have different ideas are just uneducated says more about you than them.
suing opec is stupid
but as bad as the dems sound
repubs. are just as bad.
it's dumb and dumber
umm... well, if you actually read the "drill" speech you'd see that W said the following.
"In the long run, the solution is to reduce demand for oil by promoting alternative energy technologies. My administration has worked with Congress to invest in gas-saving technologies like advanced batteries and hydrogen fuel cells. We've mandated a large expansion in the use of alternative fuels. We've raised fuel efficiency standards to ambitious new levels. With all these steps, we are bringing America closer to the day when we can end our addiction to oil, which will allow us to become better stewards of the environment."
Okay, the merits of hydrogen are limited, but it is an acknowledgment from W that oil isn't infinite. It's an acknowledgment that drilling is a temporary fix.
Frankly, the repubs are enormously better (still not good) on matters economic and energy. The dems are enormously better (still not good) on matters social and diplomatic. They both violently oppose the only areas that the other does well to the point that we get the worst of both worlds.
Frankly, the repubs are enormously better (still not good) on matters economic and energy.
So attempting to live within your means (tax and spend) is worse than borrowing and spending?
Go ahead. Show how borrowing, taxing and spending is better management than plain old taxing and spending.
The only appropriate response to strawmen is to point them out, so here it is. No one supports borrow and spend as a policy outside of short-term applications of keynesian economics. Not republicans, not even W. The don't tax but spend anyway is the result of liberals and conservatives fighting over the same piece of cheese, the liberals will not stop spending regardless of where the money comes from, and the republicans want lower taxes even if it means that there is no acceptable source of funding for liberal spending. It is not the republican platform in any way, nor does it reflect the realities of republican policies. The actual Republican party line is "don't tax OR spend".
Anyway, thank you for yet another rhetorical attack devoid of substance or validity. Keep them coming. I am enjoying this!