Oil: A Challenge to Leadership
By (05/03/07)
Suppose a handful of leftist activists in America were to position themselves to levy an unlegislated tax on the American public amounting to hundreds of billions of dollars a year and send a substantial part of the proceeds to potential enemies and those who speak unfavorably about the United States, some of whom would use the money to produce atomic weapons. What should be the reaction of so-called "red-blooded" Americans? Outrage.
Every day America imports 10 million barrels of oil from foreign nations, paying an artificially set price per barrel established by a cartel (OPEC) which is composed in part by avowed and potential enemies of the United States. The price of this crude oil bears little relationship to the normal controls of supply and demand which determine value in the public market place. As a matter of fact, the price of crude oil today is controlled by bad news. For example, the bad news of Hurricane Katrina caused a spike of some $10.00 per barrel and that increase still is being felt. It is bolstered by the drumbeat of the dominant — some say corrupt — media, which specializes in turning unpleasant news into major incidents.
The 10 billion barrels of oil are refined to some 200 million gallons of gasoline plus other distillates which makes up about half of the 400 million gallons of gasoline consumed on a daily basis by America's vehicular traffic. Unfortunately, this price per barrel has been extended to America's own domestically produced oil.
The price of crude oil on May 1 was $65.00 per barrel. The national average price of gasoline on May 1, according to American Automobile Association, was $2.965. The price of crude oil in 1973 was about $3.00 per barrel on average and the price of a gallon of gasoline was 38.5 cents per gallon. The 38.5 cents per gallon rose to $1.66 per gallon by 1981, crude oil rose to $40 per barrel following the Arab-Israeli War of 1973.
With better news from the Middle East, gasoline prices settled down to 87.4 cents in 1986 and held to less than $1.00 until Iraq's invasion of Kuwait. The continued unrest in the Middle East brought the price per gallon to a high of $3.32 in 2006.
The United States, according to Department of the Interior 1995 estimates, has reserves of 132 billion barrels of recoverable crude oil, enough to meet America's needs for about 50 years. Adequate development of America's own oil resources would return oil pricing per barrel to the traditional supply and demand method, cutting the cost per barrel by at least 40% or about $1.18 per gallon. Pricing of $1.18 per gallon would save the American motorist and transportation industry $474 million per day or $173 billion per year.
The full $2.965 per gallon at today's prices costs the American public some $1.186 million per day, nearly $433 billion per year. About half of the $433 billion or $216.5 billion per year represents imported oil and much of that goes directly to the coffers of our avowed enemies and would-be enemies in the Middle East and other principally OPEC countries.
Assuming the United States were to receive value of product for 60 % of the imports the remaining 40% ($1.18 per gallon) would fall into the same category as a tax. In effect, the U.S. citizen is paying a 40% tax on nearly all oil imported via OPEC, for which it gets nothing in return, except the knowledge that billions may go into the development of nuclear weapons for possible use against Israel, the United States and its allies.
So why doesn't the leadership of the United States develop its own petroleum resources and free itself from the domination of its enemies? It does not dare! It's a question of whether the leadership of America is hiding behind a green wall or whether it's afraid to climb over it.
The political entities who oppose all energy development, including atomic energy, are readily identifiable. One of their spokesmen, Ralph Nader, campaigning on the Green Party ticket for President in 2000, said: "There will never be another atomic energy plant built on American soil." He may as well have included oil and gas wells and off shore also.
It is no secret that nearly all leading environmental groups, including Greenpeace, Sierra Club, Audubon Society, Friends of the Earth, Earth First, and so forth, oppose the development of America's energy resources. They claim they are protecting the environment. This is a false claim for two reasons. One, the extraction of natural resources today has been made environmentally safe; two, these groups are more interested in destroying capitalism and America’s economy. Their motives are best described as anti-capitalistic and opposed to America's economy and free enterprise system. The Web site www.greenparty.org describes capitalism as “a wealthy class of social parasites who make no productive contribution to society. Unless surgically removed, this cancerous capitalism will kill its host, the biosphere."
Unless and until Americans have their country's best interests at heart react and demand their elected representatives provide the means to make America totally energy independent Americans will continue to be heavily taxed by their enemies. The Greens will prevail until America sees red.
E. Ralph Hostetter, a prominent businessman and publisher, also is a national and local award-winning columnist.
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