News-Record.com

Factcheck.org leaves out that in 1999 total federal subsidies for energy, mostly for nuclear, were $2.8 billion according to this DOE report. So the Bush administration brought a huge increase in subsidies, even if their taxes went up a little bit. I don't see why oil gets any money from us with their profits increasing, especially since they aren't using their extra profits for more exploration but to buy back their own stock.

I'm not sure why you use the 2005 energy bill as ammunition against Perdue. In 2007, unable to get 60 votes, the Senate failed to approve a House plan that would have removed $22 billion in oil company tax breaks. Sounds to me like Perdue is spot on.

Furthermore, what evidence to you have that any increase in domestic oil production will reduce our dependence on foreign oil? Oil companies will be under no obligation to sell "domestic" oil to US customers. It will be put on the world market and sold to the highest bidder, unless, of course, you are anticipating some new mandate that would secure domestically produced oil for the domestic market.

Unfortunately, your editorial falls into the category of "not much straight talk." Even the oil companies aren't interested in building new drilling capacity, because they know these rigs will wind up as standed assets in just a few short years. They much prefer the current high demand/high price scenario. It's easy money for them.

The only purpose of this proposal is to allow Bush & Cheney Inc. to score political points without having to back up rhetoric with action, as usual. It's just a cynical ploy that panders to the uneducated and ill-informed Republican base. If Bush really wanted to do it (and if he would, if he really thought it would improve oil company profits) all he would have to do is erase his father's executive order that banned offshore drilling in the first place. It's not as if he has any principles.

But Bush would rather take advantage of the situation to lay blame at Congress, now that the Dems have a slim majority. It's another example of what Scott McClellan called the "permanent campaign" mode of the Bush administration.

Bush & Cheney Inc. continue to game the system for political and financial advantage -- and for OPEC -- which is where their true allegiance lies. These two crooks don't give two hoots about good policy or governance -- or what's right for America. Traitors, both of them.

Well, Roch, if there is in essence no "foreign" or "domestic" oil but only world market oil, as you suggest, why do politicians like Perdue make an issue of our dependence on foreign oil? My assumption is that it's better from an American perspective for U.S. oil companies, employing American workers, to earn oil profits than Saudis or Iranians.

The issue of tax breaks and subsidies is complex and open to many opinions whether you're talking about energy or agriculture. I don't know the answers but I will predict we'll be providing tax breaks and subsidies for very profitable "green energy" companies soon.

Well, Laura James took what had promise of a healthy discussion of the issue and turned it into a partisan political BDS rant. But, this is what we have come to expect from the MoveOn crowd. Thank you, Laura. Yeah, traitors. and, Bush and Cheney are responsible for war crimes in Iraq as well. Let's hang 'me high. We can't just let them peacefully leave office after all of their crimes, can we?

Doug, of course there is domestic and foreign oil, all of it gets sold on world markets. Thus my question of how, short of some new mandate or nationalization, can anyone legitimately assert that more domestic production would reduce our dependence on foreign oil? I can see how wind farms, more nuclear power plants and solar energy can reduce our dependence on foreign oil (Perdue's position). More domestic drilling comes with no such assurance.

Roch,

How much of the oil and gas now being produced within the U.S. territory goes on the world market today?

I think that's a fair question, but if more oil on the world market is oil produced in the U.S., it seems inevitable that we would derive a greater share from U.S. sources.

That said, your premise strikes me as not quite right. If all oil in essence fills a world market pool, why is the greatest share of oil consumed in the U.S. produced in the U.S.? And why are our nearest neighbors, Canada and Mexico, our next-largest suppliers? Unless I'm reading you wrong, you seem to be describing a system where it's equally likely that we would draw oil from Kuwait as from Canada, but that's not the case.

I don't have time for researching this today, but here's one quick source:

http://wcco.com/local/Good.Question.oil.2.367558.html

I don't have time for researching this today, but here's one quick source: * Doug

Water! Water! Everywhere and you poor souls are searching for Oil!

http://www.youtube.com/watch?v=EWFbYz2zwRo&eurl=http://wearechange.org/

The issue is more royalties than taxes - http://www.nytimes.com/2006/02/14/business/14oil.html
The value in oil today is less in the capital used to drill but in the land holding the oil. For oil from federal lands, we should be getting a percentage of the value of each barrel pumped.

As for the 'global' oil market, what Roch may be saying is that the US could pump 1 million more barrels per day, but the Saudis pump 2 million less, the price of oil would still go up - Canadians might sell some of their oil to Europe instead of the US. If Europeans were willing to pay Mexico or Canada $150/barrel, while the US was only willing to pay $100/barrel, would any of their oil be sold to the US? Impact on the price of gas in the US depneds on total world supply/demand, whether 1MBpd more gets pumped in Alaska or Iraq doesn't matter hugely. It doesn't take much research to figure that out.

Gotcha. But in any case our pumping 1 million gpd more would have a positive effect on price relative to not pumping more.

I acknowledge the environmental concerns about further offshore drilling but don't have much regard for the "it-won't-matter-much" line. I think if you add up all the opportunities for increasing domestic productions it would matter.

winstongator is right about the global oil market. There is some small regional variation in price, but the variation due to grade is much greater. So in essence, there's a single world price of oil. Therefore, by pumping a little more oil, we would do the world a favor by adding a teeny bit to world supply and pushing world price down by a teeny bit. The small benefit would be shared by all oil users around the world. But the cost--if any--would be borne by us.

Never mind the fact that the small benefit will be years hence. Or that the effect on gasoline prices would be miniscule relative to the surprising run-up in prices since 2002. So if you want to risk getting oil blobs between your toes on Topsail Beach as they do in Galveston, TX, and get precious little economic benefit in return, then this is the policy for you: drill away!

Having said that, I have little patience for the Democratic argument that "tax breaks" gave us $4 gasoline. It might well be time to end those tax breaks, because the oil companies would do just fine without them now that oil is well over $100/barrel. And perhaps it's unseemly for the oil companies to be double-dipping in that way. But the tax breaks aren't what caused oil prices to shoot up over $100/barrel.

"Even Hurricanes Katrina and Rita in the Gulf three years ago didn't cause any major oil spills."

Consider this a complement, Doug—you're way too smart to back up your assertions using Heritage and JLF as sound and objective sources of information.

Aside from the fact that a spill doesn't have to be millions of barrels to be "major"—tens of thousands will do just fine in that category—the loss of over 100 drilling platforms due to Katrina and Rita represents billions in lost taxpayers' revenues. A "conservative" org like Heritage should be all over that, but they're not. Why? Because they're not conservative, they're corporate-driven, just like JLF.

Thanks for responses.

Andy, the environmental risk indeed might outweigh potential economic gain. I don't know, but it's worth having the discussion rather than declaring 100 percent opposition up front.

Scharrison, I'm reacting to Perdue's assertion that one hurricane "could destroy North Carolina's coastline forever." What backs up that statement?

Discounting studies by the Heritage Foundation or JLF because they're "corporate-driven" is an easy way to refute information you don't agree with but it ultimately narrows debate. The issue is whether the information is right or wrong, not who paid for its development.

The potential loss of oil platforms because of hurricanes is a valid concern that should be part of any feasibility study.

Andrew Clark, why do the oil companies get charity from us. The same reason I pay a sales tax on food and the newspapers go sales tax free! The same reason our tax dollars are wasted on the Parton Theatre, civil rights museum and thousands of other shams. Teachers got a crappy raise, and the civil rights guys got $ 500, 0000 to PA. TO BUY VOTES. Over 69% of Americans want us to drill for oil. I am one of those, I trust money hunger oil companies, a helluva lot more than, I trust government. Remember Pelosi common sense plan for lowering gas prices, That was all you could read in the LIBERAL media before the 2006 elections, the LIBERALS won, gas doubled and not a peek from the LIBERAL press that praised it. We need to start looking for every way to gain energy. That does not include Hussien Obamas plan to tax the oil companies 15 million and give the money to lazy people. That a engery plan that sucks, then of course we could nationaize the oil companies the LIBERALS last sham. Shame the LIBERAL press did the deep 6 on this plan. Guess they want to stay sales tax free.

Earlier today the Department of Energy released a report estimating that if drilling were allowed in ANWR it would bring the price of oil down by 75 cent a barrel. That's about a 0.6% decrease of the current price. It doesn't seem to be the answer to high oil prices. I imagine drilling in other coastal areas would have similarly negligible effects since I believe ANWR contains more oil than these other areas.

Valid point.

You also could say every little bit helps. If you eliminate this little bit or that little bit because each part won't make much of a difference, you miss out on a possibly significant cumulative effect.

In a development related to my initial post, this just in from the Kay Hagan campaign:

"In a complete about-face, Elizabeth Dole’s campaign said yesterday she was in favor of ending tax incentives to Big Oil and Gas and instead reinvest those funds into renewable energy. 'We need to stop the 13 billion dollars in incentives to big oil and gas companies. We've got to stop that. But we've got to use those funds instead and invest them into renewable energies,' read a statement from her campaign to Raleigh-based WTVD.

"This is a dramatic shift from Senator Dole’s long-held position, which has included voting to give Big Oil and Gas those billions of dollars in incentives just last week and against investments in renewable energy just two days ago. The comment was used in a story about high gas prices and State Senator and U.S. Senate Candidate Kay Hagan’s (D-Guilford) gas station stop in Raleigh, where Hagan spoke with consumers about the very real toll Washington’s inaction and short-sightedness has reaped on middle class families across Washington. Kay will make a similar stop at a gas station in Wilmington on Friday."

I think the reference to "middle class families across Washington" is an error. They probably meant to say across North Carolina.

But this is a fair knock at Dole if the Republican senator indeed has flipped and is now trying to portray herself as a critic of "Big Oil and Gas."

"Discounting studies by the Heritage Foundation or JLF because they're "corporate-driven" is an easy way to refute information you don't agree with but it ultimately narrows debate. The issue is whether the information is right or wrong, not who paid for its development."

On the contrary, Doug, I believe it widens the debate. Too many people on the right and the left (and some in the middle) rely on handy, pre-packaged information that meshes with their preconceived notions, avoiding the time-consuming (yet necessary) task of using multiple independent sources to verify research.

I'm not immune to this either, which is why "who paid for it" is one of the first things I try to identify. Money buys a lot of things, including loss of objectivity.

Doug said, "I trust money hunger oil companies, a helluva lot more than, I trust government."

But Doug, the oily Corporate America is our government and they plan to keep it that way.

Scharrison,

I agree to a point. And that point is where you simply discount information because of an assumption that funding from certain sources always comes with strings attached.

There's an impulse in certain quarters of this state to dismiss everything associated with JLF. That's foolish. For just one example, Carolina Journal did excellent reporting early on about the Randy Parton Theater debacle. Invalidating that because it was paid for by "corporate money" would have been foolish.

See, that's one of the parts that ticks me off, Doug.

There's some really smart people there and they've developed relationships with both public and private entities that have given them access to tons of info that you and I can only dream of. And you're right—a lot of the CJ stuff is good, straight-up reporting that you might not be able to find anywhere else.

But when you look at the whole picture, from (what appears to be) a growing connection to the American Enterprise Institute (PNAC), to the creation, funding and management of "citizens' organizations" designed to appear like grass-roots movements, you begin to see a pattern of influence that (for me) calls into question nearly all their work.

Now, you might be confident that you can read their stuff and come away with a net gain of useful, solid information, but I'm not. How much of that is due to ideology I won't even speculate on, but I'd like to think it's only a small part.