Wednesday, June 18, 2008

The Democrats are now certifiably Insane

I hate using words like that. But there is no other way to describe the stupidity being shown by the modern democratic party leadership.

Today they held a press conference where the first thing they suggested we should do to alleviate high gas prices was to NATIONALIZE THE OIL REFINERIES:

House Democrats responded to President's Bush's call for Congress to lift the moratorium on offshore drilling. This was at an on-camera press conference fed back live.

Among other things, the Democrats called for the government to own refineries so it could better control the flow of the oil supply.

Rep. Maurice Hinchey (D-NY), member of the House Appropriations Committee and one of the most-ardent opponents of off-shore drilling: "We (the government) should own the refineries. Then we can control how much gets out into the market."

Ignoring that this is America, where the government does NOT take over businesses, running refineries would do NOTHING to control the flow of oil, or to lower gas prices.

Refineries are already running near capacity. Of course, we don't have a gasoline shortage anyway, but if we did, government couldn't get more gas into the market. If they tried, they would need to buy more oil, and oil reserves are dropping faster. And the fix for dropping oil reserves is to drill for more oil.

Or, to let the prices rise so that demand falls:

With demand for gasoline falling steadily since January, retailers have had a hard time hiking gas prices fast enough to keep up with rising crude prices. While oil prices have risen 94 percent over the past year, and set a new record of $139.89 a barrel early this week, gas prices are up only 36 percent. That discrepancy has put pressure on the profit margins of companies all along the gasoline supply chain, including refiners, distributors and retailers.

Note that refineries are having a hard time turning a profit, because the oil they buy is increasingly more expensive (because of a shortage of oil), while the gasoline they sell has a decreasing demand, so they can't raise the prices enough.

It's scary that $4 gasoline is actually "cheap" relative to oil, but nationalizing the refineries won't help. Refineries are not gouging, they are not cutting off supply. The American Consumer is cutting demand.

What we need is for the Democrats to allow us to lower the regulation on refineries. There is a lot of waste because of the dozens of different blending operations needed to meet artificial supply rules imposed by the states, and refineries cost too much to build because of excessive regulation.

Of course, we don't really NEED a new refinery right now. U.S. demand for gasoline has been relatively flat since 2004. The refineries we have are enough to keep up with the demand.

The real problem is that there is not enough oil to go around. If we open up drilling, it will send a message to the market that 5-10 years from now, there will be additional supplies. This will take the edge off the futures market, and lower the price of oil. That means less money to our enemies, cheaper gasoline, and a better economy.

The democrats want to save our way out. But the simple fact is that in 10 years, worldwide demand just from 3rd world countries will increase more than our entire country uses today -- so if we stopped using altogether, there would STILL be a shortage of oil.

And the technology needed to eliminate our most wasteful uses of oil are decades away, and unlike drilling, are not a sure thing so the futures market won't really be effected by politicians SAYING we will develop them.

We NEED to develop these new technologies. But we also need to drill more of our own oil. And we need to replace the Democrats who continue the failed policies of the past, and add in their own socialistic future where government runs things.

Last point: While the house democrats stupidly think that government-run refineries will work better than privately owned ones, the senate democrats have found that the government can't even run a CAFETERIA -- they've turned their cafeteria back to private practice.

1 comment:

James Atticus Bowden said...

The Democrats are who they are. For years Moderates Republicans and other middle of the road folks have shushed Conservatives when they (we) call the Liberal Dems "socialist", "Marxist" or "communist".

I call them Liberal Human Secularists but most folks don't know what that means (they are intellectual co-branches of Nazi Human Secularists and Communist Human Secularists).

This is a wonderful teaching moment for Conservatives.

Why nationalizing industry is economic suicide...