I am constantly amused by the views of presidential candidates on energy policy. Their views are either so disingenuous or so naive that I often find it difficult to vote for a candidate.
In the 2008 election, I could have voted for Barack Obama, who declared war on fossil fuels, painted the oil companies as enemies of the people, and proposed pandering gimmicks like the âuse it or lose itâ proposal. It has been interesting to watch President Obama vacillate between punishing oil companies with windfall profit taxes, and encouraging greater production by offering them more tax incentives. It is as if President Obama now recognizes that domestic production of oil and gas would need to be a very big part of any realistic energy independence plan.
Or I could have voted for John McCain, who flip-flopped on his ethanol views, proposed gimmicks like a gas tax holiday, and picked as his running mate someone whose energy policies resembled those of Hugo Chavez.
But Donald Trump is in a category all by himself. Last month we heard Trump being âpragmaticâ by suggesting that we simply go in and take control of Iraqâs oil. His rationale was that the U.S. spent $1.5 trillion on the war there, and we should take their oil to pay ourselves back. He reiterated this in an interview with George Stephanopoulos:
Trump: George, let me explain something to you. We go into Iraq. We have spent thus far, $1.5 trillion. We could have rebuilt half of the United States. $1.5 trillion. And weâre going to then leave. So, in the old days, you know when you had a war, to the victor belong the spoils. You go in. You win the war and you take it.
Stephanopoulos: It would take hundreds of thousands of troops to secure the oil fields.
Trump: Excuse me. No, it wouldnât at all.
Stephanopoulos: So, we steal an oil field?
Trump: Excuse me. Youâre not stealing. Excuse me. Youâre not stealing anything. Youâre takingâ weâre reimbursing ourselvesâ at least, at a minimum, and I say more. Weâre taking back $1.5 trillion to reimburse ourselves.
As far as the price of oil goes, he has a simple solution to that too. He will just tell OPEC to lower prices:
Asked by CNN host Candy Crowley what his idea would be to get OPEC to lower crude oil prices, Trump said: âItâs the messenger.â
âI can send two executives into a room. They can say the same things; one guy comes home with the bacon and the other guy doesnât,â Trump said. âIâve seen it a thousand times. â¦ We donât have the right messenger. [President Barack] Obama is not the right messenger. We are not a respected nation anymore and the world is laughing at us.â
So itâs as simple as that. You know, there is naivety about energy issues, and then there is just plain ignorance. While I agree that speculation is helping to drive up prices, there are fundamental supply and demand issues involved here. OPEC is no more going to lower oil prices than American farmers are going to lower corn prices, or Donald Trump is going to lower real estate prices. Prices are not so disconnected from the laws of supply and demand that OPEC can just lower prices without consequence. What would happen is the same thing that would happen if corn prices were cut back to historical levels: Demand would increase and shortages would ensue.
Further, Trumpâs attitude seems to be that the U.S. has some kind of entitlement to that oil. How offended would Trump be if the Chinese government demanded that he sell them a piece of his New York real estate at below market prices? After all, New York real estate is very pricey. Some might say that like oil, the value of New York real estate has been pushed up by speculators, and this therefore hurts everyone who wishes to buy real estate there. But I suspect if the Chinese demanded that he sell to them at below market prices, Trump would think they were insane.
Turns out though that Trump does have a fan in author and Huffington Post blogger Raymond Learsy. Of course thatâs because Learsy is upset about the same thing: That Saudi Arabia is hogging all of our oil. Maybe if Trump gets into the White House, he can tap Learsy for Secretary of Energy. Then, instead of working to reduce our own demand and increasing domestic supplies, they can march our sons and daughters off to wars for the next two decades so we can seize the resources of sovereign nations.
By. Robert Rapier
Source: R Squared Energy Blog