CIA: Russians Hacked the Election to Give Trump the Win

Over the weekend, the Washington Post reported that the Democratic National Committee and Clinton campaign email servers were hacked into by the Russians to help Trump win the election.  And, that Vladimir Putin had personally directed the hack.  This from an anonymous source that said a handful of U.S. Senators were secretly briefed on this in a closed door session by the CIA.  But, the CIA also stressed that not all national security agencies agree on this.

So, once again, we're being fed a story from an anonymous source that can't be verified.  We don't even know what Senators were briefed.  In the era of "fake news"stories, this may just be another one. Before this latest story, the Washington Post did a hit-job on the Trump win on Thanksgiving by declaring that the Russians created "fake news" on hundreds of Internet sites in order to give Trump the win.  One has to wonder if the "Post" has an agenda here, and why they are the sole provocateur on these Russian/Trump stories.

My biggest problem is believing the whole concept of Putin wanting Trump to win. It doesn't pass the smell test.   I cannot imagine Putin preferring Trump because of all the ways in which Trump could hurt the Russian state.

First of all, Trump is a climate denier who believes that we should back off from restricting the usage of fossil fuels; especially oil.  For Russia, this is a problem since their economy is so dependent on oil.  Any increased production under a Trump presidency will lower the price and economically depress the Russian economy.

Unlike Hillary, Trump has promised to rebuild our military.  Does anyone really think Putin wants the U.S.military to get stronger and more advanced?  On top of that, Donald Trump is more likely to deploy a missile defense system in Europe.  Something that Putin does not want to happen.  Further, Trump has never once stated that he wouldn't put boots on the ground, and Hillary clearly stated that wouldn't happen in her administration. Also, Trump may ignore the Strategic Arms Limitation Treaty signed by Obama without Senate approval as mandated by law.  Thus we could be on track to rebuild our nuclear weapons power.

Lastly, Trump's temperament is a great unknown with respect to how he would deal with any conflicts that occur between Russia and the U.S.   This could force Putin to give pause when attempting to take over another country or area such as Crimea. The Democrats and Hillary Clinton have long held the belief that Trump was the last person they wanted with his finger on the nuclear button.

What I'm more concerned about, is that this election could be totally discredited and Trump's win nullified.  What then?  Could Hillary sue in federal court and take the win away from Trump on the basis that he won unfairly?  Would the whole election process have to be rerun?  If so,  would Obama remain in office while that process was completed. That is certainly a possibility since he has ordered a completed intelligence review on his desk before he leaves office.  And, if the election is rerun, for sure, the voter turnout for the Democrats would be great.  This is certainly a mess that our founding fathers never anticipated as they drafted the Constitution.

References:

Secret CIA assessment says Russia was trying to help Trump win: https://www.washingtonpost.com/world/national-security/obama-orders-review-of-russian-hacking-during-presidential-campaign/2016/12/09/31d6b300-be2a-11e6-94ac-3d324840106c_story.html?utm_term=.f799ed76f51b

CIA Concludes Russia Interfered with U.S. Election to Help Trump: http://fortune.com/2016/12/10/cia-concludes-russia-interfered-with-u-s-election-to-help-trump/

CIA: Russia Interfered With U.S. Elections: Politicians and pundits are calling for further investigation into the matter: http://www.snopes.com/2016/12/10/cia-russia-interfered-with-u-s-elections/

U.S. President Barack Obama ordered intelligence agencies to review cyber attacks and foreign intervention into the 2016 election and deliver a report before he leaves office on Jan. 20, the White House said on Friday: http://www.reuters.com/article/us-usa-election-cyber-russia-idUSKBN13Z05B?feedType=RSS&feedName=politicsNews&utm_source=Twitter&utm_medium=Social

Oil, taxes — and big problems for Russia's economy - CNBC.com: http://www.cnbc.com/2016/04/01/oil-taxes--and-big-problems-for-russias-economy.html

What's Really Behind Obama's $10/Barrel Oil Tax

Obama is preparing to deliver a speech justifying his proposed $10 a barrel federal oil tax that would be phased in over the next 5 years; arguing that it is needed to fund his climate change agenda for building rail transport systems in heavily trafficked regional areas of the country.  Sounds logical; doesn't it?  Of course, its our deteriorating roads and infrastructure that really needs the money. But, I'll put that aside.

In reality, the tax is intended to kill existing oil fracking and any new oil exploration using fracking. At the same time, it will add 25 cents to the cost of each gallon of gas you and I buy.  Thus, hitting the working poor the hardest and forcing many to consider high mileage hybrids or electrics.

More importantly, because the tax is at the producer level, it substantially increases the cost of exploration and the extraction of oil.  For example, if it was fully implemented and oil was selling for the current, pre-tax price of $30 a barrel, the gross return on investment for producing a single barrel would be cut to just $20 after the tax was applied.  In other words, with an average break-even cost of $25/barrel for fracking operations, many fracking operators would have to shut down to avoid a $5 or higher per-barrel-loss on every barrel of oil they produce.

Obama knows all these facts and they are the real reasons behind his $10/barrel oil tax.

References:

Obama to call for $10-per-barrel oil tax to fund clean transport: http://www.foxnews.com/politics/2016/02/04/obama-seeks-10-per-barrel-oil-tax-to-fund-clean-transport.html

 With Fuel Prices Low, President Obama Floats $10 Per Barrel Tax On Oil: http://www.forbes.com/sites/kellyphillipserb/2016/02/09/with-fuel-prices-low-president-obama-floats-10-per-barrel-tax-on-oil/#1616e20642b0

Oil crashed by 6.3 percent to $30.98 on January 11, as the price of crude oil continues to fall toward the $25 break-even cost of production: http://www.breitbart.com/big-government/2016/01/12/crude-oil-price-still-crashing-toward-25-breakeven/

Not Approving Keystone Actually Puts The Environment At Greater Risk

OK, I get it.  Obama wants to play into the hands of the environmentalist lobby by rejecting the Keystone XL Pipeline; arguing that there is no strategic or economic advantage to allowing the project to go forward.  Apparently, the environmentalists seem to think that if the pipeline isn't approved, Canada will just stop producing its tar sands oil that would have to be carried by that pipeline, and the world will be saved from global warming.

Nothing could be further from the truth.

Canada isn't going to walk away from billions of dollars in revenue per year and all the jobs that would provide.  The reality is that they will just keep extracting the oil and will continue to do what they have already been doing over the last 7 years while Keystone was in limbo.  That means that their oil will increasingly transverse our country by rail.  A fact that resulted in record train oil spills in 2014; causing millions to be spent for cleanup; assuming it can actually be cleaned up.

Additionally, Canada already has plans to sell its oil internationally, since the U.S. has been dragging its feet on Keystone.  Despite what environmentalists seem to think, that oil will be used to provide fuel for an ever-increasing number of the world's gasoline-powered automobiles. 

So, essentially our own environment may suffer from increased rail oil spills,  and the  atmosphere will probably suffer from less effective refining in other countries. 

Lastly, the argument that Canada's tar sands oil is extremely dirty is another lie that was used to kill Keystone.  The U.S. actually extracts and refines even dirtier oils in places such as California and Alaska.

Between oil spills and less effective refining, the U.S. and world environments are actually at greater risk than they would be with the Keystone pipeline. 

References:

Obama’s Keystone Rejection Strengthens His Hand at Climate Talks: http://www.nbcnews.com/news/investigations/oil-train-spills-hit-record-level-2014-n293186

Oil Train Spills Hit Record Level in 2014: http://www.nbcnews.com/news/investigations/oil-train-spills-hit-record-level-2014-n293186

Canadian tar sands crude heads to Bay Area refineries: http://www.contracostatimes.com/ci_23366257/canadian-tar-sands-crude-heads-bay-area-refineries

Exclusive Map: The Tar Sands Pipeline Boom: http://insideclimatenews.org/news/20120430/exclusive-map-tar-sands-pipeline-boom

How clean is our ‘dirty’ oil? You’d be surprised: http://ipolitics.ca/2014/07/18/how-clean-is-our-dirty-oil-youd-be-surprised/

The Hidden Costs of Dramatically Reducing Oil Consumption

Most people think that "oil" means one thing: Gasoline.

In 2012, Obama made this point clear when he said that oil was the "fuel of the past".  Now, the Pope, too, in his encyclical on climate change states that we need to replace fossil fuels with renewables; meaning that, alongside natural gas and coal, we should abandon oil production.

The problem with this way of thinking is that it ignores how pervasive oil is in our lives.  Well beyond the gasoline we use in our cars, lawnmowers, etc.  Out of a 42 gallon barrel of oil, we are only able to cost effectively refine 47% of it into gasoline.

The remaining 53% of products created from a barrel of oil are bonuses that, in many ways, can't be easily or economically replaced if gasoline production is dramatically reduced.  In fact, that 53% is used to make over 6,000 items. 99% of all durable (non-biodegradable) plastics are derived from that 18% "other" category resulting in more than 40,000 different uses.   Things such as the covering on all electrical and telephone cables or synthetic carpet and the padding underneath.  Even the tires on your car are a result of synthetic rubber derived from oil.  The propane in your gas barbeque was derived from oil.  The roads we drive on are all created with oil's asphalt byproduct. Then too, there are millions of trucks, buses, locomotives, and sea-going freighters which are all dependent on the power of diesel fuel. Oil gives us much of the fertilizers that provide us with such high output per acre.  Do we really want to reduce fruit and vegetable production in the face of growing populations?

The simple fact is that, if we reduce our oil consumption because gasoline is being run out of town, there will be shortages of the materials and products we depend so heavily on.  The result will be higher prices for everything we buy.  Quite frankly, in some cases, there are no alternatives for the materials derived from oil.  You are not going to make asphalt from wind and solar.  Nor, are we going to be flying in airplanes that run on electricity.

We need to seriously rethink this mad drive to eliminate oil.  Otherwise, life in this country and the rest of the world will be very expensive; with the poor suffering the most.


References:

Oil is 'the fuel of the past,' says President Obama: http://news.yahoo.com/blogs/ticket/oil-fuel-past-says-president-obama-212950677.html

Pope Francis issues anti-fossil fuel message: http://www.mrt.com/business/oil/article_35569626-16b0-11e5-a1d6-f78f8181b726.html

Oil breakdown source: InvestingDaily: http://www.investingdaily.com/17600/3-58-2-58-1-get-cracking/

LPG (liquefied petroleum gas): http://www.explainthatstuff.com/lpg.html

From Oil to Plastics: http://www.materialscience.bayer.com/en/media/special/backgrounders/plastic-production.aspx

Everyday Products from Oil (partial list): http://www-tc.pbs.org/independentlens/classroom/wwo/petroleum.pdf

A partial list of products made from Petroleum (144 of 6000 items): http://www.ranken-energy.com/Products%20from%20Petroleum.htm

Beyond natural gas and electricity; more than 10% of U.S. homes use heating oil or propane: http://www.eia.gov/todayinenergy/detail.cfm?id=4070

Obama and the Left's Misuse of the Term 'Tax Loopholes'

Starting with his presidential run in 2008, and for the last 7 years, President Obama has been talking about closing tax loopholes for businesses.  However, his use of the word "loopholes" is incorrect.  What he should be referring to is "tax incentives" that corporations get for certain business activities. Using the word loopholes makes tax breaks and incentives sound nefarious or even criminal.  The reality is that most of the "loopholes" that the President is talking about are legal tax breaks that the IRS or Congress ruled on as incentives for jobs, or to provide our corporations with international competitiveness.

The biggest tax incentives (or, in his vernacular, loopholes) that the President wants to eliminate are those for buying and operating corporate jets. Along with high CEO salaries, they gall him more than anything else because they are a symbol of wealth. I'm sure he feels that corporate jets shouldn't exist because it's unfair that the average person can't have one too.

Today, if a corporation buys a jet, the cost enjoys accelerated depreciation for tax purposes, of just 5 years under the law.  That's 2 years shorter than the depreciation on commercial jet liners.  Thus, in just 5 years a company can offset nearly all of the cost of buying a jet -- less inflation -- by lowering its taxes.  There is nothing abnormal about this. Corporations have always been allowed to depreciate "high ticket" capital expense items such as replacement roofs, buildings, phone systems, cars, trucks, manufacturing equipment, etc.  At the same time, the operation of a jet and all associated costs are deductible as business expenses in the same way office supplies are deductible under the law, again to lower the tax burden.  Now, to be fair, the use of a corporate jet did have a "tax loophole" in that the corporation could also deduct the cost of using the jet for non-business entertainment uses, but that was identified in 2007 and was finally closed in 2012 by the IRS.

The primary reason that the corporate jet tax breaks exist is to keep over 1.2 million jobs intact.  That's how many workers are directly or indirectly employed in making them and their parts; flying them as pilots and co-pilots; maintaining and servicing them; and, working in the airports they use throughout the country.

Similar tax incentives that Obama believes are loopholes are those that allow oil drillers to depreciate drilling equipment, trucks, and cars.  The expense of drilling the well is also deductible. However, in this case, it is not about fairness but global warming.  Anything he can do to slow down oil exploration and raise the price of oil is his main objective but, like corporate jets, slowing down oil exploration and production will only cost Americans their jobs.  Something we can ill afford in an already slow economy.

Make no mistake about it. Obama has created his own "loopholes".  He has created tax deductions for buying electric cars and solar and wind power systems that only benefit the rich who can afford to buy them.

I think that  -- instead of attacking loopholes that create jobs -- President Obama should think about all the policies that he has implemented that retard job growth.

References:

2015 State of the Union Address:  Obama attacks 'loopholes' for wealthy, business: http://www.washingtonexaminer.com/obama-attacks-loopholes-for-wealthy-business/article/2559008

New Dogfight Between Obama and Private Jet Industry: http://www.cnbc.com/id/100439712

Obama budget would slash oil tax breaks while boosting renewables: http://fuelfix.com/blog/2015/02/02/obama-budget-would-slash-oil-tax-breaks-while-boosting-renewables/

 IRS Lays Out New Rules on Corporate Jet Use: https://www.google.com/search?q=IRS+Lays+Out+New+Rules+on+Corporate+Jet+Use+&ie=utf-8&oe=utf-8

Under Obama:  Recovery Has Created Far More Low-Wage Jobs Than Better-Paid Ones: http://www.nytimes.com/2014/04/28/business/economy/recovery-has-created-far-more-low-wage-jobs-than-better-paid-ones.html

The Climate Change Activist's Nightmare: Falling Oil Prices

In mid-2008, the price of oil plummeted from over $140/barrel to just under $40/barrel by the end of the year (noted by the shaded area in the graph below).

Then, prices started to rebound and eventually topped out at $107 in mid-2013.  Interestingly, this fall and then a rise in oil prices greatly affected the daily U.S. consumption of oil.

In 2008, when oil prices bottomed out, Americans consumed 55,108.1 gallons of gasoline per day.  Eventually, as oil prices rose, consumption fell to just 24,722.5 gallons per day in 2013.  Thus proving a direct correlation between oil prices and consumption.

Now, since mid-2014, oil prices have fallen like a rock once again.

In fact, oil is falling so fast the Federal Reserve Economic Data database is unable to keep up with the changes.  This chart shows oil at around $55/barrel.  As, of this writing, it is actually trading below $49. But, putting this aside.  If oil is keeps falling, gasoline consumption is sure to rise once again.  Maybe even a doubling of the 24,000 gallons/day that was seen in 2013.  And, this is what keeps global warming activists up all night.  That's because, simply, if you double consumption, you double the carbon foot print.  And remember, gasoline prices aren't just falling in the U.S. but also, world wide. So, the world's carbon footprint is also sure to rise.

References:

U.S. Energy Information Administration: Refiner Motor Gasoline Sales Volumes: http://www.eia.gov/dnav/pet/pet_cons_refmg_d_nus_VTR_mgalpd_a.htm

Federal Reserve Economic Data (FRED):  Interactive Graph: Crude Oil Prices: West Texas Intermediate (WTI) - Cushing, Oklahoma: http://research.stlouisfed.org/fred2/graph/?id=ACOILWTICO,


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The Expansion of the Clean Waters Act: A Backdoor Way To Shut Down Fracking And Coal

Earlier this year, President Obama's Environmental Protection Agency (EPA) announced a draft rule to arbitrarily expand the Clean Waters Act beyond its current applicability to navigable waters and, once again, without any Congressional approval.  Under the proposed rule, the EPA would now control access to both intermittent and permanent sources of water; even if that water exists on private property.  So, if there's a pond out there that only forms after a rainfall, but is mostly dry the rest of the time, it will now be regulated by the EPA.

The justification being used by the Obama Administration for expanding the Clean Waters Act is that we need to insure access to clean drinking water and available and uncontaminated water sources for farming.  However, I believe there is an alternative motive behind this ruling and why the President doesn't want Congress involved, and that is so they can effectively shutdown oil drilling, and especially, hydraulic fracturing; or, what is commonly called fracking.

We all know the old story that oil and water don't mix.  But, when it comes to drilling for oil, a lot of water, mixed with clay and lubricants, is needed to cool and lubricate the rotary drilling heads and vacate the hole of any debris as the drill head bores its way through thousands of feet of soil and rock.  Now, usually, when the drilling is completed, and oil is found, this "mud" (the water, clay, lubricants, and cleared debris) is no longer needed.  But, not in the case of fracking.  Once the the drilling reaches the desired depth and sideways location, water is again, mixed with things like sand and chemicals, and is then pumped into the drilled earth at very high pressures.  In doing so, the shale rock is fractured and the oil or natural gas, contained within that shale, is released.  And the fracking continues until there is no more oil to be extracted.

So, I think it is highly likely that Obama will use the expansion of the Clean Waters Act to minimize any access to water for the purpose of fracking, or even, simply drilling for oil.  Unfortunately, oil and gas  aren't the only operations that require water.  Coal, too, requires water to cool and lubricate its drilling bits. So, I wouldn't doubt that the denial of access to water for all three of these fossil fuel operations is one of the first things that the EPA will do with their new found powers.  I also would expect that, when the EPA is taken to court over the expansion of the Clean Waters Act, Obama will, once again, find himself on the losing end of trying to legislate without Congress.

References:

Clean Water Act proposal would protect more water sources in West: http://www.latimes.com/nation/la-na-epa-waters-20140326-story.html

Drowning our property rights: EPA's misuse of the Clean Water Act: http://thehill.com/opinion/op-ed/218663-drowning-our-property-rights-epas-misuse-of-the-clean-water-act

Explained: Oil and Gas Development Using High Volume Hydraulic Fracturing: http://www.watershedcouncil.org/learn/hydraulic-fracturing/

Explained: Oil Drilling: http://www.scienceclarified.com/Mu-Oi/Oil-Drilling.html

Why America's Oil Boom Just Might Go Bust

Thanks to the oil boom, and as a result of the fracking of oil shale, America is now on track to be the largest oil producer in the world within the next year. 

However, our overzealous production may possibly cause that "largest" title to quickly slip through our fingers.  Right now there is simply too much oil in the world and the price for Brent oil (the world benchmark traded worldwide) has fallen from over $110 a a barrel to well below $70 in just a few months; with some experts predicting $40 within the next year.   It is this glut of oil that may cause many of our oil shale fracking operations to be shutdown because it will be too expensive -- relative to the going price for Brent oil -- for those operations to continue.  And, for some of our oil shale operations, the current price may already be too low to continue as shown in this breakeven chart of our major oil shale fields:

But, what this chart also shows is that, if oil does hit $40/barrel, it would make all but two fields unprofitable.  Additionally, oil below $70 is probably killing off any possible new fracking operations in this country. Further, these low prices may also make many of our deep-water off-shore drilling operations unprofitable.

The simple fact is that much of the growth in the economy and the increase in jobs has resulted from the oil boom.  If it comes to an end, our economy could contract (slip into recession) and unemployment would necessarily rise.  Fears of this came yesterday when the stock market fell 268 points as oil hit 5-year lows on a 3% drop.

References:

U.S. to Be Top Oil Producer by 2015 on Shale: http://www.bloomberg.com/news/2013-11-12/u-s-nears-energy-independence-by-2035-on-shale-boom-iea-says.html

Brent Crude - Wikipedia, the free encyclopedia:  http://en.wikipedia.org/wiki/Brent_Crude

Economist Jeff Rubin: Oil Might Fall to $40 a Barrel: http://www.newsmax.com/Finance/Rubin-oil-40-supply/2014/09/25/id/596895/

Here Are The Breakeven Oil Prices For Every Drilling Project In The World: http://www.businessinsider.com/citi-breakeven-oil-production-prices-2014-11

Oil & Gas Boom 2014: Jobs, Economic Growth And Security: http://www.forbes.com/sites/davidblackmon/2014/02/20/oil-gas-boom-2014-jobs-economic-growth-and-security/

Bad Timing? Chevron Christens New $8B Deepwater Oil Platform: http://www.forbes.com/sites/christopherhelman/2014/12/02/bad-timing-chevron-christens-new-8b-deepwater-oil-platform/

Five Regions Where Big Oil Is Foolishly Chasing Profits: http://oilprice.com/Energy/Crude-Oil/Five-Regions-Where-Big-Oil-Is-Foolishly-Chasing-Profits.html

Dow drops 268 points after oil finds 5-year low: http://www.cnbc.com/id/102256233

For Russia, U.S. Oil Production Is Doing More Harm Than Sanctions

One thing is sure, the Democrats hate oil companies; and they want you to hate them too.  This year they are demonizing the Koch Brothers. In the past, Exxon Mobil and other big oil companies were the targets of their wrath.  Every time gasoline prices jumped significantly, the Democrats held hearings to publicly flog the oil company CEO's for manipulating prices so that they could fatten their already fat profits.

But, nothing ever came out of all those hearings. That's because, secretly, every Democrat wants high prices at the pump.  Only then will consumers shift to alternatives to oil or buy more fuel-efficient vehicles or drive less.

Barack Obama is no different.  Since coming to office, he has used EPA lawsuits -- most of which were found to be without merit -- to stop oil production and fracking operations in places like West Texas. He has blocked the Keystone pipeline project in order to restrict oil supplies. Following the BP Deep-Water Horizon oil spill in the Gulf, he has effectively used that as an excuse to limit what had been a previously fast-growing and vast area of oil production.  At the same time, federal oil leases -- both for offshore and federal lands -- have been severely restricted by this President.  Lastly, he has attempted to use questionably endangered species like the Lesser Prairie Chicken and the Greater Sage Grouse to stop oil drilling and production in vasts swaths of the U.S.

But, despite all those efforts, and thanks to private and state oil drilling, America is set to be the world's largest oil production country by sometime next year.  And, we are all the beneficiaries because there is now a glut of oil and prices are falling; with lower prices at the gasoline pump to follow.

Even more interesting is the fact that lower oil prices, as a result of rising U.S. production, might be doing something to Russia that the President's own sanctions over the Ukraine haven't done.  That is, to severely hurt their economy.  Russia is heavily dependent on oil production and exports.  But, as the Russian Central Bank so noted, lower oil prices are threatening their economy. and, that comment was made when Brent Crude was at $98 a barrel.  Today, Brent is selling at about $86 and will probably fall even lower as world inventories continue to rise.

So if President Obama wanted to hurt Russia even more, he could approve the Keystone Pipeline.  Approve more federal leases and back off litigation and the EPA's abuse of the Endangered Species Act to restrict production.  However, given the political influence of the environmentalists and the Democrats, he would rather the Ukraine be handed over to Russia than increase U.S. oil production by one drop.

References:

Venezuela blames U.S for global oil price slump: http://news.xinhuanet.com/english/business/2014-10/17/c_133723506.htm

Massive Rise in Crude Oil Inventory Sends Prices Tumbling: http://247wallst.com/energy-economy/2014/10/08/massive-rise-in-crude-oil-inventory-sends-prices-tumbling/

U.S. to Be Top Oil Producer by 2015 on Shale, IEA Says: http://www.bloomberg.com/news/2013-11-12/u-s-nears-energy-independence-by-2035-on-shale-boom-iea-says.html

Russian Central Bank Fears Weak Oil Price Could Threaten Economy: https://www.google.com/search?q=Russian+Central+Bank+Fears+Weak+Oil+Price+Could+Threaten+Economy&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a&channel=sb

Court backs Texas revolt against EPA's new greenhouse gas rules: http://www.theguardian.com/environment/2011/jan/05/court-texas-epa-greenhouse-gas

Oil and gas production on federal lands is in free fall under Obama: http://dailycaller.com/2014/04/16/oil-and-gas-production-on-federal-lands-is-in-free-fall-under-obama/

Save a Chicken, Drill a Well - Wall Street Journal: https://www.google.com/search?q=Save+a+Chicken%2C+Drill+a+Well+-+Wall+Street+Journal&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a&channel=sb

Critics cry foul as feds place lesser prairie chicken on threatened species list: http://www.foxnews.com/politics/2014/03/28/critics-cry-foul-as-feds-place-lesser-prairie-chicken-on-threatened-species/

EPA backs off on fracking contamination claims in Texas: http://hotair.com/archives/2012/04/01/epa-backs-off-on-fracking-contamination-claims-in-texas/

EPA’s Abandoned Wyoming Fracking Study One Retreat of Many: http://www.propublica.org/article/epas-abandoned-wyoming-fracking-study-one-retreat-of-many

EPA drops action against Range Resources over Parker County water wells: http://www.star-telegram.com/2012/03/30/3849362/epa-drops-action-against-range.html

Robert F. Kennedy, Jr.: An ISIS-Like Terrorist For Climate Change

One thing that should rile any champion of freedom, free speech, and free association, is the fact that ISIS is forcing non-Muslims to convert to Islam by telling them that they have to either convert or die.  In a way, Robert Kennedy Jr. is no better than ISIS when it comes to protecting  the freedoms that we all enjoy. Listen  to this asinine rant by this radical liberal regarding those who are climate change deniers or who are guilty (in his mind) of damaging the planet with businesses that produce CO2:



Sadly, this only shows that he and other climate alarmists are getting more and more frustrated by the fact that their cause is losing ground in the court of public opinion. So like any non-democratic dictator, tyrant, or bully, he wants any and all opposing thought to be shutdown by threatening those who disagree with jail time.

His targeting of the Koch Brothers for profiting from the oil business merely shows how politically motivated this Kennedy family fool is.  The Koch's are just 2 people out of thousands who are profiting from oil in this country.  But, because they are billionaires who give money to Republicans, Kennedy finds them more offensive than any other executives that he and others have labelled polluters.

By the way.  Kennedy receives royalty checks from three oil companies that he and the rest of the Kennedy clan own outright: Mokeen Oil, Kenoil and, the Arctic Royalty Limited Partnership.  Maybe, he too, like the Koch's, should be jailed for destroying the planet and profiting from it.

Lastly, Koch Industries was founded in 1940; almost 50 years prior to the world even talking about global warming and climate change.   Somehow, Kennedy now thinks that the father of the Koch brothers should have seen global warming coming and should not have started that evil oil producing and oil products conglomerate in 1940. It was companies like Koch Industries that provided the oil and materials that helped defeat the Nazis and the Japanese in World War II.

Reference: Live Leak:  Oil Company Owner, Robert Kennedy Jr. Rants Against Oil Companies, PJ Media Video Confrontation:  http://www.liveleak.com/view?i=ace_1411422073

Koch Industries:  http://en.wikipedia.org/wiki/Koch_Industries

Why ISIS 'Is' A Credible Threat

We keep hearing from the Obama Administration (specifically the FBI and the Department of Homeland Security) that ISIS poses no direct credible threat to the United States.  My only problem with that is that it was the FBI who interviewed both the Fort Hood shooter and the Boston Marathon bomber before they committed their acts of violence and, who seemed not to think these people posed a threat either.

In my opinion, ISIS should literally scare the whatever out of every American.

First of all, they are growing in size and strength.  In June, they were 10,000 strong. Now, the CIA has estimated their number to be at about 31,500.  That's a growth rate of almost 7,000 fighters per month.  If this continues, it could mean that, in just 10 more months, ISIS could reach 100,000.   That is a force that could easily takeover much of the territory in the Middle East besides major chunks of both Syria and Iraq.

What should be more worrisome to the U.S. and the world is the fact that passport carrying Europeans and American citizens are also joining. The problem with ISIS-friendly passport holders is that they can freely enter many European countries and the U.S. without having to apply for a visa.  They can simply buy an airplane ticket, say they are tourists, and land anywhere in the U.S. on a 24/7 basis with no one really questioning their purpose or intent.  As a result, there is now an unprecedented access to our homeland that hasn't been seen before with any other terrorist group; including Al Qaeda.

But, the biggest threat to our safety is the huge amounts of cash that ISIS is amassing.  It is now estimated that they have acquired $2 billion dollars from contributions and from looting, ransoming, and theft activities.  When they took Mosul, for example, their looting of that city's bank gave them half a billion dollars in gold and cash.  Beyond that, their newly found access to oil wells in Syria and Iraq is netting them an estimated $3 million a day from oil sold on the black market.

With all that cash ISIS doesn't need to hijack an aircraft in a 9/11-style terrorist attack.  They could simply buy some used commercial cargo jets at a cost of less than $2 million dollars each.  That cash also gives them the ability to buy shoulder-mounted rocket launchers and grenade launchers on the black market.  Both weapons can be used to bring down planes in takeoff or landing or to do serious damage to land-based targets like shopping malls or railroad trains. It also means that they could buy radioactive material to build a dirty bomb or acquire highly explosive C-4 to take out bridges and other infrastructure. Smuggling these weapons into the U.S. might be as simple as paying "coyotes" to cross them over our currently porous southern border.

To say that ISIS is not a credible threat is simply irresponsible.  They are a threat and they have the money, manpower, weapons, and potential access to carry out horrendous attacks on our own soil. The two video beheadings of Americans proved we are a target, with Obama's name clearly spoken in both. Further, they have already said that their goal is to fly their flag over the White House.  In the late 1990's the then-President ignored Bin Laden, and the result was 9/11.  Now, we seem to have another President ignoring the ISIS threat.  Will we, once again, wait for the next attack before we seriously take this enemy out?

References:

FBI: No credible threats to US from Islamic State: http://www.washingtontimes.com/news/2014/aug/22/fbi-no-credible-threats-to-us-from-islamic-state/

FBI & DHS: Islamic State Poses No Credible Threat to US: http://www.breitbart.com/Big-Peace/2014/08/25/FBI-DHS-Islamic-State-Poses-No-Credible-Threat-to-US-Sec-Hagel-Says-Opposite

 FBI interviewed dead Boston bombing suspect years ago: http://www.cbsnews.com/news/fbi-interviewed-dead-boston-bombing-suspect-years-ago/

 Fort Hood Shooting: FBI Ignored Evidence Against Nidal Hasan For Political Correctness, Report Says: http://www.huffingtonpost.com/2012/07/19/fort-hood-shooting-fbi-nidal-hasan-political-correctness_n_1685653.html

Number of ISIS fighters has swelled to as many as 31,500, CIA says: http://www.foxnews.com/politics/2014/09/12/number-isis-fighters-has-swelled-to-as-many-as-31500-cia-says/

ISIS' half-a-billion-dollar bank heist makes it world's richest terror group: http://www.telegraph.co.uk/news/worldnews/middleeast/iraq/10899995/ISIS-half-a-billion-dollar-bank-heist-makes-it-worlds-richest-terror-group.html

How ISIS managed to acquire $2B in assets: http://www.cnbc.com/id/101761986

Boeing 727-200 for Sale: http://www.globalplanesearch.com/jets/airliners/boeing/727_200.htm

Corruption, greed fuel black market for arms: http://articles.baltimoresun.com/2003-08-14/news/0308140153_1_surface-to-air-missile-weapons-of-war-black-market

New ISIS Video: ‘We Will Raise Black Flag Over White House’: http://foxnewsinsider.com/2014/08/08/new-isis-video-%E2%80%98we-will-raise-black-flag-over-white-house%E2%80%99

Canada Tires of Waiting For Obama. Approves A New Pipeline to Supply Asia (China).

The President has delayed the Keystone Pipeline Project for almost as long as he's been in office.  That pipeline would have brought oil from Canada for refinement throughout the central and southern United States; and it now seems to be in jeopardy.  The Canadian government has just approved a trans-Canada pipeline that would move the oil that was originally destined for the Keystone Pipeline to their Pacific ports for shipments to Asia; primarily China.

So, instead of counting on our friendly neighbor to the north to supply us with oil, that neighbor has been forced to help China instead.  And, that oil, that would have been more cleanly refined in the U.S., will probably be processed in a country whose CO2 emission laws hardly exist.  As a result, Obama is actually responsible for creating more CO2 pollution than if it had been processed here in the US.  Is this what going it alone on Climate Change is all about?

Reference:

Canada OKs oil pipeline to the Pacific Coast: http://bigstory.ap.org/article/canada-oks-oil-pipeline-pacific-coast

The Democrats And Oil Speculators

It was just a matter to time before the Congressional Democrats would follow the President's lead on going after oil speculators.  Fresh with news that Federal investigators had just snared themselves a real case of  oil manipulation by an electronic trading firm, Optiver, Representative Chris Van Hollen and 42 other Democrat Congressmen wrote Attorney General Eric Holder a letter; urging him to use every means possible to "insure the proper functioning of our oil and gas markets."  Of course, that letter wasn't really necessary because, just last week, President Obama had announced, in a Rose Garden address, that he had committed the Justice Department to doing just that.  But, what the hell, Van Hollen and his buddies saw a political opportunity and they took it.

Now, to keep the politics going,  Van Hollen went on Neil Cavuto's Your World show to argue with Neil over how oil prices are being jacked up by speculation and manipulation of the markets.  Of course, Van Hollen immediately brought up the Optiver case as proof of this.  But, is Optiver any real proof of any  manipulation of the markets?  I don't think so.

First, the kind of charges that were brought against Optiver are extremely rare.  In terms of frequency, the feds charged that, in 2007, Optiver (one the world's largest oil and commodities trading companies) attempted to manipulate the market 19 times and were successful in at least 5 cases.  Wow, 19 times by a company that probably trades oil futures contracts thousands of times a year!  But here's another thing.  No guilt was ever proven and the court never found any real wrongdoing.  Optiver negotiated for and accepted a $15 million penalty; probably, to just get the feds off their backs and avoid any further attorney fees.  But, for a deceptive politician like Van Hollen (the former Chairman of the Democratic Congressional Campaign Committee), the penalty itself was enough proof that oil speculators are widely and illegally manipulating the oil and gas markets.

The U.S. Dollar: Where's The Woolite?

Yesterday, the stock market euphorically rose by as much as 176 points on the initial news that our Federal Reserve was going to "spend" up to $300 billion in order to buy back $300 billion of it's own debt (See Full Story). If that sounds like double talk, it certainly is! It's sort of like paying off your mortgage with your own credit card and having no money left to do anything when the credit card bill is due. But, if you're the Federal Reserve, you can just float more debt to do what you want to do. It's like creating "new money out of thin air" as noted in this news article: "Fed to pump another $1 trillion into U.S. economy". If you or I did the same thing, they'd call it "kiting" and we'd be serving "20" in some Federal prison. And, for sure, Bernanke and the rest of his gang at the Federal Reserve might be just as criminal in doing what they are doing.

On top of the $300 billion to buy back U.S. bonds, the Fed will use an additional $700 billion as a systemic cash infusion in the credit markets to free up borrowing for homes, cars, etc. Again, this $700 billion doesn't really exist; except, in the minds of the Federal Reserve.

By doing this, its like washing all of our currency in hot water and harsh detergent. Just like a cotton shirt, there will be some serious shrinkage. And, with shrinkage, comes inflation.

There's a big gamble doing what the Federal Reserve is doing. They are trying to combat a deflationary economy by adding in to it their own inflation. You can literally see that there is deflation when you look at home prices having fallen by as much as 50 percent. Deflation is also apparent as retailers are attracting buyers with deep discounts. Automobiles are being sold at losses to reduce inventory. So, by introducing inflation into our economic system, the hope is that prices will stabilize and credit purchases will start moving again.

The problem lies in the fact that the deflated dollar will remain deflated; even after prices recover. Then, the inflation that was used to fight deflation becomes its own problem. The only way to fight this new evil is to seriously raise interest rates; which, in itself, could cause another recession. But, this time with rampant inflation. As a result, simply raising interest rates won't solve the inflation problem. For that to be solved, we will, somehow, have to quickly erase our accumulated debt though heavy taxation so that the Federal Reserve can reverse and undo what they did yesterday by pulling back dollars from the world's debt markets. But, in the wake of all this, we could literally see double digit inflation on everything that we buy; and, for a long period of time.

Just so you know, this kind of thing has been tried before by other countries and those governments don't exist today. They just collapsed. So, this is a big gamble.

In reaction to that potential, the stock market ended today with a loss as the investment community finally saw the risk that exists in this program (See Full Story). Since the announcements of yesterday, gold prices have jumped nearly $80 an ounce as people sought the yellow metal as an inflationary hedge. The U.S. Dollar fell against other currencies; making imports more expensive for us to buy. Oil prices jumped to a new 2009 high of nearly $52 a barrel. If the Fed wanted inflation, it certainly didn't take long for it to start showing up.

Make no mistake about it, this is a seriously desperate move on the part of our Federal Reserve. The risks are high and rewards might be questionable. I can only believe they are doing this because they are seeing statistics and trends that are more worrisome than had been previously thought. Don't forget. This action is independent of the so-called trillion dollar Stimulus Package; which, by all indications, seems to be having a difficult time in starting up.

I personally don't know how we are going pay for all this debt. It just might take over a century or more to do it and that could hurt the future of this country.

The Obama Inflation Machine

Inflation is the most worrisome disease that can hit any country's economy. It can seriously devalue that nation's currency and literally destroy the purchasing power of the poor, and those on fixed incomes. In the world of active employment, salaries always lag behind any inflated costs for goods and services; especially for essentials such as food and clothing. And, as usual, it is always the poor who are the biggest losers when inflation spirals out of control.

I've said before that I am not an economist. But I did study economics in college. I have seen its practical application in both business and in our economy. One thing I do know is that if you overstimulate demand for a scarce commodity, you will see prices rise. That's part of the basic economic principal behind the Law of Supply And Demand. I also know that businesses and corporations don't have a pile of money that they leave sitting around; waiting for the government to collect it, due to the latest tax plan. Any excess money is generally used to expand the business, which typically means hiring more people. Further, any business gets its income from selling things. Ultimately, they will offset any higher costs, like new taxes, by passing those higher costs on to you and I in the form of higher prices. If, because of overseas competition, they are unable to pass their increased costs along, they will have to reduce expenses, and that usually means that people will get laid off or may lose their jobs completely.

This is why I am concerned about Mr. Obama's tax, regulation, and spending plans. It makes no sense to give each person a $500 tax credit when your policies will cost them one or two thousand dollars more per year for the products and services they need to buy. This is especially true for the poor, and for those of low and fixed incomes. Based on Mr. Obama's expressed policies, I see serious (society affecting) inflation ahead of us. Here are the areas I see being hard hit:

1. Healthcare Costs.

Right now, there are about 46 million uninsured in this country, or about twenty percent of our population. Both John McCain and Barack Obama want to provide full healthcare insurance for Americans. However, the Obama plan is more coercive and government dependent than that of John McCain. The problem with either plan (but more so with the Obama plan, which appears to extend government healthcare coverage to illegal aliens) is that you are going to throw 46 million newly insured at our health system. Assuming that the current system is based on providing primary and secondary care for about 250 million people, that it is a lot of new demand that will be placed on the current providers of healthcare. To complicate the demand scenario, there is a push for preventative care; especially by Barack Obama. This fact, alone, will increase the frequency of doctor's visits and that will place a whole lot of demand on an already overtaxed primary care system. The bottom line? Demand will totally outstrip the supply of healthcare. Prices can only go up, and the lines will only get longer for any and all healthcare services; from doctor's visits to hospital care. You only have to look to the U.K. and Canada to know this to be true.

2. College Education Costs.

Obama wants to make college more affordable. This is because the cost of higher education is spiraling out of control. The reason is that we have too many students (too much demand) for the available education in this country (the supply). As long as colleges and universities can keep turning away students in the first year, costs will continue to go up at a rate that is faster than inflation because the demand is just too high. Now, Obama wants to place even more demand on the system by making college education more affordable through his new, $4000 tax credit. This is insanity. If we want more affordable higher education in this country, the focus should be on broadening the availability of colleges and universities to increase the supply. To address the student as the driver of the problem is simply foolish economics. It is truly the tail wagging the dog.

3. Energy Costs

Like the rest of the Democrats, Barack Obama will exclusively focus on using wind and solar for our future energy needs. Even though he has loosely "implied" that he might drill for oil, don't even expect that to be the case if he gets into office. He plans to spend $150 billion over the next 10 years to implement wind and solar systems. That's $15 billion a year. But, this is a complete ruse. To the uninformed, that sounds like a lot of money. But, to put that number into perspective, our largest of 6 major oil companies, Exxon-Mobil, will expend 30 times that $15 billion in a single year to bring their share of oil products to market. In essence, Barack Obama's plan is like trying to kill a dinosaur with a flyswatter. Further, the only purpose of solar and wind is to replace our current domestic production of electricity. That production, for the most part, is being cheaply and primarily produced from domestic coal and domestic natural gas and some nuclear energy. Oil and gasoline are not even being addressed by Obama's plan. Wind and solar's only purpose is to reduce the effects of global warming and to satisfy his special interest group, the environmentalists/global warmists. It isn't to make energy cheaper for America. If it was, wind and solar would be cropping up all over this country on its own.

While Obama fiddles with solar and wind, the true energy reality of this country is that we have over 200 million vehicles (cars, trucks, buses, boats, and airplanes) that need oil-based fuels to operate. With an "average" age of over 9 years, those vehicles aren't going to go away anytime soon, and new oil-dependent cars are rolling off the assembly line everyday, and will continue to for many years to come. We are losing 2 percent or more of our domestic oil supply every year. It is a scarce commodity, and we need to make it survive. If you put it all together, Mr. Obama will do nothing but dramatically increase our energy costs in the future. The only reason costs have come down now is because of the possible economic downturn. Once that is over, expect prices to skyrocket because the needed supply to meet the demand won't be there.

4. All Other Domestic Product and Service Costs

For most any American business, Mr. Obama's plans for protectionism, increased taxes, mandated healthcare, and the ease of unionization, will, at the very least, just drive prices for goods and services through the roof. To pay for all this, companies will just raise prices and you and I will be the ultimate footers-of-the-bill for Obama's new policies. Worst case, we could see the end of some American businesses. That end could easily come to those who are already struggling against foreign competition, and who are unable to raise prices in the face of the new Obama policies.

Take for example increasing taxes on businesses. When taxes are applied across the board, there is a rollup effect. That's because 99.9 percent of all businesses rely on other businesses to exist. Every business has suppliers and subcontractors that they utilize to conduct their own operations. Those suppliers could be as simple as a pencil manufacture. And, often, those suppliers and those subcontractors have their own suppliers and subcontractors that they depend on. When taxes are applied, and prices increased, those costs have to be passed on. They are compounded all along the supply chain. A business will not only have to raise prices for its own increased tax burden; but it will also have to raise prices to compensate for the increased costs that are being passed on to it by a supplier who is compensating for its own increase in taxes. There ain't no Santa Claus in this process.

The same compounding effect will take place when a small business is now forced to provide healthcare insurance to all of its employees. That new cost could be rather high. Further, unionization could seriously result in higher salaries being paid. Put it all together and many businesses will have no other choice but to raise prices in order to compensate for higher taxes, higher salaries, and high healthcare insurance costs.

Even Mr. Obama's plan to increase income taxes and apply FICA to those making more than $250,000 a year will have an inflationary effect. Someone making that amount of money will see their income reduced by at least $33,000 a year under his plan. That's a lot of money. As a result, you can expect those people to look to replace that lost income by either demanding a higher salary, or by looking for a higher paying job elsewhere. These people are getting a salary above $250,000 because they have a high value to a company, and because they would have a high value to any other interested companies. This could result in high prices being passed on to you and I. If prices cannot be raised, then some "lower salaried" employees could lose their jobs to compensate for the higher salaried personnel getting raises.

There is no free ride. All these promises of 95 percent of Americans paying less tax under an Obama administration are just more smoke and mirrors. You and I will pay, and we will pay heavily for all those who think they're getting a free ride. Mr. Obama has two different sized hands. The small hand is the one you see, and that's the one giving you the hand out of lower taxes, free healthcare, or a government check in the mail. The other hand, the big one that you can't see, will be the one that's in your wallet when inflation exceeds any benefit or payout that you thought you were getting from this guy. Mark my words!

A Truth (or three) About Compressed Natural Gas

The TV ads regarding Compressed Natural Gas (CNG) say that it is clean, cheap, and it is American. Well, not quite.

Let's address the last point first about CNG being American. As a country, we import more than 15 percent of the natural gas we use (See Full Story). If it is so American, why, then, would have to import any of it? The TV ads also mentions the abundant gas reserves in shale basins. However, just like drilling for oil, we can't get to it because drilling and extracting natural gas from those areas is being blocked by the Democrats in Congress and by the environmentalists. That's why we import.

In terms of being clean? Yes, it is. It certainly doesn't contain the contaminants like sulfur that is produced when burning petroleum-base fuels and coal. However, it is still a fossil fuel and, for that, it gets a big "F" for cleanliness from the likes of Al Gore. Burning natural gas produces carbon and it is carbon, if you listen to the Global Warmists, that is causing the excess heating of the earth. That's why you will never hear a democrat promote natural gas. Just listen to Barack Obama and you would know this. He doesn't mention natural gas at all. He primarily talks about solar and wind.

Lastly, let's address the issue of natural gas being cheap. Compared to gasoline it is 40 percent cheaper. For a vehicle that it is specifically designed and built for natural gas it is cheaper to operate. But, that vehicle isn't. It will cost a few thousand more dollars to build than a gasoline version of the same car. Existing vehicles can cost between $8000 and $50,000 (for trucks and buses) to convert to natural gas. Even at 40 percent cheaper than gasoline, it would take the life of the car to recoup the increased costs of buying or converting a natural gas vehicle as opposed to a gasoline vehicle of the same type and size.

The purpose of all these TV ads by T. Boone Pickens and Aubrey McClendon of Chesapeake Energy Corp. is to get Congress and the American people behind exploring and drilling for natural gas. They both have a financial incentive to do so. By running these TV commercials, their hope is that the environmentalist that have been so adamant in blocking natural gas production are put aside by the public's need to get off foreign oil. They also hope that additional markets are created for natural gas by moving vehicles to this form of fuel.

This is not to say that Messrs. Pickens and McClendon only have a profit motive behind their beliefs. In fact, I firmly believe that they are very patriotic. They both can see a real pathway to our independence from foreign oil. Natural Gas is something that both these people know and know that it is capable of creating that independence. But, so are other alternatives. As I have said in this blog many times before, we need it all. Natural gas is just one facet in our energy future. We should include drilling for our own oil (to support our existing base of vehicles and power production), nuclear energy (because it is so clean and carbon free), wind and solar (because of the like benefits to nuclear; but, not to the extent being promoted because they have the downside of requiring mammoth space to produce energy), clean coal (as an abundant source of energy) and biofuels like ethanol and bio-diesel (as long as they don't infringe on food production in this country).

But, all these forms of energy are simply bridges to our energy future. I personally think that our future is in hydrogen technologies. It is clean, renewable, and almost infinitely available in this world. We can use nuclear, wind, and solar to provide the energy needed to cleanly extract hydrogen from sources like natural gas or, even, from water. That should be the long-range goal of this country.

OPEC's Short-Term Vision

Just recently, OPEC decided to cut production to keep oil prices high. The reason is simple: OPEC countries like Saudi Arabia, Iran, and Venezuela, have become accustomed to the mammoth cash inflows they have been getting into their government coffers for high oil prices. Many are still working off the cost to sink an oil well in the 1970's; so, profits can be as high as 800% on a barrel of oil.

But, OPEC's greed will ultimately hurt them. It will hurt them more than consumer actions that were taken following the Arab Oil Embargo of 1973 when small cars became the rage and the demand and price of oil fell dramatically. It hurt them more because, this time, the West won't just cut back on oil usage with more fuel efficient cars. This time, the West will walk away from oil completely as the consumer decides to find other ways to avoid four dollar a gallon, or higher, gasoline prices.

OPEC might not realize it but, this could be the beginning of their end. This country, and the world, has already started moving away from oil for its energy needs. People are buying more fuel efficient automobiles such as hybrids. Expect offshore drilling to become a reality. Electric cars like the GM volt and the Chrysler "EV's" are scheduled to appear on the market by 2010. Wind and solar are getting attention. Hydrogen vehicles are closer than ever in being a reality. And, yes, we might even build a Nuclear power plant our two!

It is possible, that within one or two decades, OPEC will see the demand for oil fall off dramatically. We could do it if we do "all those" things that will cut into this country's "imported" oil demand; including drilling for our own new oil reserves. We could be the leader that the world will follow in becoming energy independent. In doing so, we will become more secure because we would no longer be dependent on our enemies for oil. We won't be sending $700 billion a year to our enemies military coffers. But, most importantly, we can watch the only economic base that many of our enemies have, oil production, just wither away from below their feet.

The Road Block to Fuel Efficiency

Many states, like Georgia, California and Nevada, have annual vehicle taxes or registration charges that are based on a vehicle's assumed market value. This tax, called an "ad valorem tax," provides for a maximized tax level in the first year that a car is taken off the showroom floor. Then, over a period of five, seven or ten years, that tax is reduced on step-basis until some standard or minimum tax level is eventually achieved. This is a class-based tax on the assumption that it targets the "rich" who can afford a new or newer car. It favors the poor of the community who have and hold older cars. It certainly acts as an incentive for someone to keep an older car as long as they can keep it running.

In Barack Obama's acceptance speech of Thursday, he mentioned his goal of getting off Middle East oil in 10 years. Of course, he didn't specifically say how that would be done. He did, however, mention that his plan would include assisting people in buying newer and more efficient cars. I suppose he would do this with some kind of Federal tax deduction as a incentive for buying a new car.

To me, this is another case of the "left" hand not understanding or knowing what the other hand his doing. Because of the prevalence of "ad valorem taxes" in America, mostly in Democratic, tax-it-if-moves legislatures, the ad valorem tax will always act as a deterrence to anyone wanting to buy a new or newer car. That's because the Federal tax deduction, the one that Mr. Obama will probably propose, will only apply in the first year. From then on and until the minimum tax level is achieved, the owner of the car will continue to pay the higher tax for his newer car. Therefore, only the higher income peoples of our society will be able to afford both the new car and afford the tax burden that goes with it. Mr. Obama doesn't know it but, in essence, he had just promised a tax cut for the rich. The rich who can afford new cars and will gladly take that tax deduction against the new and higher taxes that Mr. Obama plans to impose on them.

It is really easy for a national politician to make speeches that sound so rosy. However, the implementation is something entirely different. I guess the "hope" that Mr. Obama is always talking about is the "hope" that you, the voter, can't figure out that he can't really achieve what he is saying. Right, Mr. Obama!

One final note. Barack Obama seems to think that the Middle East is the only source of oil that we should worry about. This just shows how clueless he is. Russia is a big oil producer in the world. Oil is helping to fuel their new military growth. Because both Western and Eastern Europe are so dependent on Russian oil, don't expect any effective or real or substantial actions to be taken against Russia by either NATO or in the United Nations. Also, more closely to home, Venezuela is another oil producer that is flush with cash from the current high oil prices and is heavily buying military equipment from Russia. We should be seriously concerned about any future moves Venezuela can take against its neighbors in South America and, ultimately, against us. Also, the oil markets in the world work like a big commingled bucket that gets dipped into by most non-old and some oil producing countries in the world. While we don't trade with a country like Iran, it is more than likely that we are, today, getting Iranian oil into are ports. A staff writer from the Obama-friendly Associated Press clearly outlined how unlikely Mr. Obama's promise of Middle East oil dependence would be (See Full Story).


Image by Danilo Prates' on Flickr with Creative Commons Licensing. All rights retained. (Click to View Other Works).

Obama's 3-Card Monte on Oil Supply

Yesterday, Mr. Obama gave another speech on energy. In that speech, he once again reiterated his stand that drilling in the Arctic National Wildlife Reserve (ANWR) and off the shores of California and Florida won't help lower oil prices. But, he said he was for limited drilling if "politically" it would get us on track for "the "alternative energy initiatives that he has proposed.

OK. I "guess" that sounds reasonable if you "really believe" that "increasing supplies" (by drilling for our own oil) won't actually reduce the price of gasoline at the pump.

But, then, Mr. Obama proceeded to expose his "own lie" about the effect of "increased supply" on high oil and gasoline prices. He did this by proposing a release of 70 million barrels of oil from the Strategic Oil Reserve (SPR) to increase oil supplies (See Full Story). He went on to say that this would reduce the high oil prices and, subsequently, reduce gasoline prices.

So, let me get this right.

America "burns" about 20 million barrels of oil per day. So, in the world of economics according to Obama, releasing 3-1/2 days of equivalent oil usage from the SPR (a total of 70 "million" barrels) will dramatically lower prices. However, increasing "new" oil supplies by an estimated 16 "billion" barrels from the Arctic National Wildlife Reserve and by a minimum of 18 "billion" barrels for offshore drilling won't have any impact on price. So, in other words, Mr. Obama thinks that replacing 3-1/2 "days" of oil usage in America would have more of an impact on gasoline prices "than" any new supplies of oil that could literally keep this country going for 4-1/2 "years" on their own. This is from a guy who actually has 300 people available on his economic team.

Besides the fact that Mr. Obama has "flipped" on his stands on drilling and the release of oil from the SPR (I guess after looking at the polls), he is flatout lying to the American people. His proposal of 70 million barrels, at best, might reduce prices at the pump by 5 cents; and, only for a very short time. Further, the longer it takes to release those 70 million barrels into the marketplace, the less the savings will be at the pump. Drilling in ANWR and off the shores of California and Florida and in the oil shales of Colorado will literally double or triple our domestic oil supplies and buy us the time that we need to convert to alternative energy sources. By drilling in those places that have been blocked by the Democrats, it is possible to increase our domestic oil supplies to above 70 percent of our oil usage instead of less than 35 percent of today. It will also reduce by half, the $100 billion dollars a year (and growing) that is flowing out of this country and into places like Saudi Arabia in order to satisfy our insatiable oil needs. Most importantly, we would reduce the "risk" of serious supply disruptions and the economic disaster that could result from the instabilities in the Middle East, Nigeria, and Venezuela.

The security of the United States is at risk. Oil should not be used like some pawn to garner votes and campaign contributions from the likes of MoveOn.org or Greenpeace or the Sierra Club. This is serious business that should not be treated so lightly that our politicians can take a 5-week hiatus; as they did last Friday. Nancy Pelosi and company are trying to stall past the election; thinking that they will have complete control and the ability to hoist the wishes of their "small" political base of environmentalists onto all of America. For the Democrats, the cost to America for their inaction is immaterial. They see no problem in ramming trillions upon trillions of dollars in ineffective and premature energy ideas onto this country so Al Gore can sleep at night. This is literally crazy and probably the most irresponsible government we've ever had in this country. A government that absolutely hasn't thought through the realities of what they are doing and plan to do.

The Electric Car Fallacy

Let's suppose we could wave a magic wand and make every car in the State of California an "electric' vehicle with batteries that could be charged up by just plugging those cars into any standard electrical outlet. What then? We'll, the "then" would be that California's electrical grid would totally collapse under the demand. Californians can barely keep up with their current electrical needs. This is a State who, almost every summer, has experienced the loss of electricity due to rolling blackouts.

If all the cars in this country were suddenly electric, there isn't enough infrastructure to support it. We would probably need 50 percent or more electrical generation capability than we have now. At best, we might get 20 percent of our power from new solar or wind. But, that will take years, if not decades, to build. The bulk of the electricity that will needed for any all-electric-car society will have to come from traditional source of electrical production; and, that is coal and natural gas. Both of which produce carbon; that nasty greenhouse gas.

There are over 200 million vehicles (cars, trucks, buses, boats, and airplanes) in this country that are totally dependent on some form of oil product like gasoline, diesel, or jet fuel. It will take a couple of decades to replace all of them all. Those vehicles can literally keep going all day and night by just taking a few minutes to refill their tanks with petrol; every few hundred miles. Americans aren't going to look too favorably at driving for a couple of hours (maybe four) and, then, sitting around for 12 hours while their cars charge up for another brief ride. And, there is no way that you will see a Boeing 747 "plug in" and, then, fly around the world. And, the trucking and boating industries? Forget it!

To keep America (and the world) moving, automobiles and trucks will need some kind of quick and easy replaceable fuel supply. Electricity isn't it. Electric cars need hundreds of pounds of batteries. Unless electrical batteries can be made so light weight that some-how they become hot-swappable at service stations, it is and will continue to be a useless technology. Just think about scaling up your kid's rechargeable, remote controlled car to the size of the car that is in your garage. Then, think about how big, in relationship to the toy car, those batteries would have to be. Now, you can imagine the problem.

I still say that the only truly viable replacement for gasoline/diesel vehicles will be hydrogen.