The Oil Drum | House Democrat(s?) Call for Nationalization of US Refineries

118 comments on House Democrat(s?) Call for Nationalization of US Refineries

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westexas on June 18, 2008 - 6:03pm

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.

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whit on June 18, 2008 - 6:10pm

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.)

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westexas on June 18, 2008 - 6:16pm

With current crack spreads, many oil companies might be well advised to sign over title to refineries for one dollar.

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Patently oil on June 18, 2008 - 9:45pm

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.

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Robert Marston on June 18, 2008 - 11:00pm

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?

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Robert Marston on June 18, 2008 - 11:07pm

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...

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tomc on June 19, 2008 - 8:23am

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.

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shaman on June 19, 2008 - 9:13am

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.

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Sandman_USMC on June 19, 2008 - 12:21am

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.

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Rich Walden on June 19, 2008 - 1:12am

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.

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westexas on June 19, 2008 - 6:57am

9. Establish a bipartisan commission to determine which Laws of Nature to repeal:
http://www.glossynews.com/artman/publish/laws-of-nature-repealed-1291.shtml

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shargash on June 19, 2008 - 9:00am

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)!

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leduck on June 19, 2008 - 1:08pm

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.

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tonyw on June 20, 2008 - 1:18pm

"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.

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westexas on June 19, 2008 - 7:05am

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

THE president of the United States has the power to attack, and perhaps destroy, the Organization of the Petroleum Exporting Countries, the illegal cartel that has driven the price of oil over $130 per barrel. This can be accomplished without invasion or bombing. No special legislation is needed. The president need simply allow the states to seek relief in the Supreme Court under our antitrust laws.

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shargash on June 19, 2008 - 9:03am

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.

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shaman on June 19, 2008 - 9:17am

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 ;-).

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leduck on June 19, 2008 - 1:11pm

and then they stop selling oil in dollars and use euros instead.

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tonyw on June 20, 2008 - 12:58pm

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...

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118 comments on House Democrat(s?) Call for Nationalization of US Refineries

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“If kindness and comfort are, as I suspect, the results of an energy surplus, then, as the supply contracts, we could be expected to start fighting once again like cats in a sack.”

—George Monbiot