In the Senate Today: Good Theater, Bad Policy

By November 9, 2005Energy

Today, the circus comes to town. Before the Senate Energy Committee, starting at 9:30 this morning, will be 5 or so oil company reps, called on the carpet to explain their recent earnings statements where they dared to — gulp! — make a profit. In all the (sympathetic) news reports, they say the Senate is trying to get to the bottom of why gasoline prices are so high. As Col. Potter would say, “Bullhockey!” The purpose of these hearings is theater, pure and simple, so the Senators can show the voters back home that they really care about high energy prices.

Well, let’s see. If they really cared about high energy prices, they would be looking at all sources, wouldn’t they? They’d have to look at why they’ve made it virtually impossible to build a nuclear plant in this country (none has been started since the 70’s). They’d have to get to the bottom of why we have the highest natural gas prices in the world. Oil prices are set on the world market, so there really isn’t much they can do about that. But natural gas prices are set on a domestic level, so the more supply we have, the more it’ll help prices. The Outer Continental Shelf (OCS) holds 420 trillion cubic feet of the stuff, but 85% of it is shielded by a federally-imposed moratorium. Why don’t they lift it?

It’s fair to ask your Senator — especially the ones you will see all indignant and red-faced today, glowering at the oil company witnesses — what they’ve done to increase domestic supply so as to help level off the prices of energy. Last week’s ANWR provision in the Senate just barely squeaked through, thanks to heroic efforts by manufacturers. As of this writing we are not assured of the including of an ANWR or OCS provision in the House legislation being debated this week.

So as you watch the circus today, you can enjoy it for all its theater, its mock outage, its finger pointing, its posturing for the folks back home. But don’t think for one second that this has anything to do with the price of energy. Drop a note to your Senator and let them know you don’t think we can tax our way to energy independence, don’t think higher taxes on the folks doing the exploring is the way to encourage more exploration.

At the end of the day, it’s all just so much entertainment. For our money, we’d rather see a panel of enviros. If you want to get to the bottom of why energy prices are so high, they’re the real culprits.

Join the discussion 3 Comments

  • jhupp says:

    There’s a lot of truth in what you’re saying, but I’m not sure I can accept it all. The argument that we should drill anywhere there might be anything is a bit far-fetched. One of the problems that totalitarian regimes have is that (apart from official state functions) they don’t care about aesthetics at all; physical utility is all that matters. Aesthetics preserve a sense of dignity, and if you don’t buy it, consider the success of the broken windows solution to New York’s crime problem. It doesn’t mean I’m wholly opposed to all the ideas, but it’s a consideration that isn’t often taken.

    You would probably agree with me that the words we are using to discuss this situation are ridiculous. “Defend your profitability, you for-profit business!” Apparently, we’re asking everyone to operate like the airlines. That said, the concern that Senator Cantwell voiced is a legitimate one, that a lack of market transparency coupled with just-in-time solutions are the types of things that can create market manipulation. The oil industry certainly ranks pretty low on the transparency scale.

  • House leaders late Wednesday abandoned an attempt to push through a hotly contested plan to open an Alaskan wildlife refuge to oil drilling, fearing it would jeopardize approval of a sweeping budget bill Thursday.

  • Fyodor Myshkin says:

    Whatever it takes to feel good about yourself. What I read into comments like yours is pure blackmail. Your argument is: “if you would just give us want we want we wouldn’t have to raise our prices.” That’s ridiculous. Furthermore, it’s obscene to obscure the self-serving nature of such a scheme with patriotism.