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They Can't Outrun the Law Forever
Posted By Conn Carroll On June 11, 2008 @ 2:03 pm In Energy | Comments Disabled
Writing in the Modesto Bee , Rep. George Radanovich (R-CA) reports: “Listening to constituents this Memorial Day, the issue most on their minds was the price of gasoline.”
Judging from the Senate’s desperate effort to “do something” about gas prices this week, we’re guessing most congressmen heard the exact same things from their constituents. Liberals in the Senate trotted out the same grab bag of meaningless measures for their energy bill this week: windfall profits taxes on oil companies, increased taxes for domestic oil producers, and lawsuits against OPEC. The Los Angeles Times  editorial board (hardly a bastion of conservative thought) called the Democratic plan “silly”and added “Trying to find an economist who thinks a windfall-profits tax is a good idea is like searching for a climatologist who thinks global warming is caused by trees.”
For decades now liberals in Congress and the White House have been restricting domestic U.S. energy production and have escaped paying the political consequences of the requisite high energy prices. But you can’t outrun the law law of supply and demand forever. USA Today  editorialized today:
Surging gasoline prices have prompted renewed calls for drilling in environmentally sensitive areas, particularly Alaska’s potentially oil-rich Arctic National Wildlife Refuge.
It’s true that any serious oil production from ANWR would take about 10 years. But dealing with the energy situation requires an ability to look beyond quick fixes. The fact is, ANWR oil would be flowing now if President Clinton hadn’t vetoed a drilling bill in 1995.
Estimates are that the area could eventually produce about a million barrels of oil a day for 30 years. That’s nearly 5% of the 21 million barrels a day Americans consume, and almost as much as the United States imports from Venezuela — where the money Americans spend for oil enriches a leader who bitterly opposes U.S. interests and helps fund an armed insurrection against U.S. ally Colombia. Congress has been arguing about ANWR for nearly three decades; it’s time to break the gridlock.
Both USA Today and the L.A.Times claim that opening up ANWR would do nothing to lower the price of gas today. But they are ignoring how futures markets affect the price of oil. Rep. Radanovich explains :
Speculators look at unrest in Nigeria and the Middle East and are betting that oil supply will continue to be a problem. If America commits to increasing its domestic oil production, it can provide immediate, near-term relief at the pump.
If the U.S .wants to prove to the world we are serious about lowering the price of oil, we will have to commit to more than just ANWR. A Department of Interior study  estimates the U.S. has 19 billion barrels of oil onshore that could easily be developed if Congress changed policies. An additional 85.9 billion barrels of oil are available to the U.S. offshore as well. China sure is aware of these vast oil reserves. The Chinese are currently drilling for oil 60 miles of the cost of Florida  … closer to the shore than U.S. companies are .
Americans are starting to get it. According to Gallup , 57 percent of Americans support allowing drilling in U.S. coastal and wilderness areas currently off limits. Conservatives can ease Americans’ pain at the pump and save the economy if they continue to press this issue.
Article printed from The Foundry: Conservative Policy News from The Heritage Foundation: http://blog.heritage.org
URL to article: http://blog.heritage.org/2008/06/11/they-cant-out-run-the-law-forever/
URLs in this post:
 Modesto Bee: http://www.modbee.com/opinion/national/story/323865.html
 The Los Angeles Times: http://www.latimes.com/news/opinion/la-ed-oil11-2008jun11,0,1249678.story
 USA Today: http://www.usatoday.com/printedition/news/20080610/edit10.art.htm
 study: http://www.cnsnews.com/ViewNation.asp?Page=/Nation/archive/200806/NAT20080606c.html
 currently drilling for oil 60 miles of the cost of Florida: http://www.ibdeditorials.com/IBDArticles.aspx?id=297904745555169
 closer to the shore than U.S. companies are: http://www.washingtonpost.com/wp-dyn/content/article/2008/06/04/AR2008060403052.html
 Gallup: http://www.gallup.com/poll/107542/Majority-Americans-Support-Price-Controls-Gas.aspx
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