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6/12/2008
Mark Rahmlow on Steve Kagen and big oil
With energy prices once again taking center stage this election year, local politicians have been doing their best to appear they have answers.
Case in point: U.S. Rep. Steve Kagen, D-Appleton, working hard to capture favorable media fawning, even as his proposals at best, contain zero immediate relief - and kindly, are idiotic. The Congressman, seemingly promoting big oil, volunteered to fill up gas tank for his constituents early on. “I am working hard to bring about the changes we need, like helping everyone in Wisconsin who is struggling to pay for the gas and energy required to stay in business,” Kagen said just last week.
Of course, Kagen quickly cast blame on the Bush Administration for the current energy pinch saying the President has done nothing in eight years to make the U.S. more independent from foreign oil. Actually, the President has done more to promote energy independence in eight years than Congress has done in the last forty years; from promoting ethanol alternatives to advocating for ANWR, Bush has gotten out in front on energy.
On the other hand… as China is conducting oil research off the coast of Florida, and Canada looks for oil in South Dakota, Congress continues to tie the hands of domestic producers. Ignoring the free market principles of reducing taxes, deregulation, and producing more domestic energy, Kagen and company have sought cosmetic changes to energy policy.
First, Kagen supported legislation that stopped shipments to the Strategic Oil Reserve just before Memorial Day. The price of crude oil on the world market continued to rise.
Then, Kagen authored legislation giving the U.S. Dept. of Justice authority to sue other countries for “anti-competitive price discrimination”. Local news organizations provided Kagen’s re-election campaign with good fodder. Except… the thinking world recognizes that to even talk about suing OPEC is just plain stupid.
And then…, the freshman lawmaker implied energy investors have been engaging in potentially illegal behavior by investing “in oil and other commodities without actually taking possession of the oil.” Oh horrors. So, while Kagen spent the last two years leveling accusations, gas prices increased 70 percent.
Here’s what Kagen should be busy doing
Kagen must encourage his colleagues to support the gas tax suspension, or better yet reduce the federal gas tax permanently. The demand for energy does call for immediate action. There is no doubt it is affecting the airline industry, bus lines, truckers and farmers. But the Kagen-supported measures do not put the country on a path to energy independence. Energy independence will only result from free market solutions.
Opponent John Gard recently said increasing domestic supply is the “surest way to reduce the price of oil.” Instead of investigating domestic oil producers, Congress ought to be looking for ways to partner with them to increase supply. America simply must begin building new refineries to handle the domestic needs that already exist. Congress must balance the country’s needs with the wishes of the powerful environmental lobby that has kept federal lands off limits for new exploration.
“We can dramatically reduce our dependence on foreign oil and strengthen our long-term national security by utilizing the assets we have in North America,” Gard continued.
And yes, the country can continue to research alternatives without reliance on costly government mandates. But if Kagen believes investigating domestic producers, suing sovereign nations, and criticizing energy investors will produce relief for consumers, he is sadly mistaken.
Mark Rahmlow is a former field director for Tim Michels 2004 U.S. Senate campaign and one-time Campaign Manager for McCormick for Congress in 2006.
COMMENTS
Instead of suspending or reducing the federal gas tax, why not eliminate it in its entirety? The gas tax goes towards paying for road infrastructure maintenance. I don't own a car, yet I still benefit from road being well maintained. All the food I need to survive is delivered on roads that are paid for by taxes that I never contribute to.
Instead of a gas tax, all road funding should be shifted to and paid for by the income tax. That means you need to raise the income a little to compensate, or cut waste in other areas, such as the war in Iraq which has so far drained 600 billion dollars from our economy.
Stephen Flynn (Thu Jun 12 10:42:00 2008)
It is absolutely foolish to institute a gas tax suspension. The oil companies will simply fill the gap and we'll be worse off when the tax is reinstituted. Better that we (a) drill for more oil in the states and deep gulf, and (b) institute a public oil competitor to compete with the OPEC cartel. See http://tinyurl.com/yr2vfd for details.
Jack Lohman
http://MoneyedPoliticians.net
Jack Lohman (Thu Jun 12 13:52:02 2008)
Look at the world supply question. National Geographic just had a good article on the peaking supply. (there is much research supporting that position). The world oil supply is global, not local. Please show me an economic study that shows how and when ANWR production would affect US gasoline prices? Please provide facts, not the redundant and incorrect assertions that we can produce our way out of this mess.
Please show me a study that shows how cheap domestic production (for example from existing oil wells) leads to lower gasoline prices.
We can produce our way out if we are producing fuel efficient vehicles and other energy efficient technologies.
You criticize Kagen for his votes but you propose ending or severely reducing the Federal the gas tax? Your proposal is indeed much more significant than Kagens as it would starve the country's infrastructure and ripple through the economy as road construction slows to a crawl. Kagen's proposals may have been ineffectual but yours are downright dangerous.
dave allen (Thu Jun 12 15:27:37 2008)
An across the board, however, not overly restrictive drilling in Alaska, off shore USA, lower 48's, in addition to a calculated mix of all alternative energies, offer the only rapid and long-term plans that can succeed.
Only bi-partisan agreement will move such an initiative, but it needs to happen NOW.
Richard Parins (Thu Jun 12 19:21:26 2008)
Richard,
I'm with you as far as a mix. However, please provide link to studies that show the impact of drilling in terms of prices and timing of actual oil flow. I believe it will be a too little too late scenario. There are no more North Slopes and even if there were it is a world oil market. I do not believe domestic production does anything to reduce USA oil prices except as it may reduce world oil prices.
dave allen (Thu Jun 12 19:30:04 2008)
Dave, *any* production is better than the status quo. Admittedly whatever we do now is too little too late, but doing nothing is not the answer either.
Yes, Bipartisanship would be nice, but more than that we must block the campaign cash that flows from the oil companies to the politicians, which buys subsidies and tax breaks. And we must dump politicians like Sensenbrenner, who owns $5 million in oil stock and has voted 100% for the industry. THEN we'll see these guys fixing the problem rather than pocketing industry cash!
But John Gard isn't the answer either. There's never been a campaign contribution he hasn't liked, and we sure don't need more of the same.
Jack Lohman (Thu Jun 12 20:28:26 2008)
Jack, I agree. I wish there was more emphasis on a comprehensive conservation effort. Conservation is the quickest, most effective, cheapest way to affect the supply/demand equation.
dave allen (Fri Jun 13 13:17:41 2008)
Conservation would be neither quick nor easy Dave. We've got too many guzzlers on the road, including my own SUV. Nuclear power and converting coal to gas would help, but long term we need something like hydrogen fuel. In the meantime I'd think more drilling would be useful.
Jack Lohman (Fri Jun 13 15:57:40 2008)
Jack,
Please provide information on drilling. Everything I have read indicates that drilling (in the US)cannot significantly affect the price of oil. Do you have some reference? On the other hand I have read conservation strategies that would have very quick impact.
dave allen (Sun Jun 15 16:39:48 2008)
I don't have any proof one way or the other, Dave. But my gut says it is going to require a multi-pronged approach. More drilling and new technology. And if the latter wins the race the drilling will slow. But I hear China is currently drilling off our coasts, and it seems rather silly for us to sit on our thumbs.
But wouldn't it be nice if our politicians were not taking money from the Oil industry and we could trust them to establish a non-partisan, non-conflicted board of experts to study the issue?
Jack Lohman (Thu Jun 19 09:35:02 2008)
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