High Gas Prices may be Keeping some of Us in Recession, but the Rich and our Elected Leaders are doing Okay

Posted by PITHOCRATES - June 27th, 2011

The Oil Supply determines Gasoline Prices

President Obama will release approximately 30 million barrels of oil from the U.S. Strategic Reserve to try and bring down gasoline prices for this summer driving season.  Because the high cost of gasoline is leaving consumers with little disposable income.  Or a reason to reelect him in 2012 (see U.S. Consumer Spending Stalled in May by The Associated Press posted 6/27/2011 on The New York Times).

Americans in May spent at the weakest pace in 20 months, a sign that gas prices are taking a toll on the economy, according to a government report Monday.

Recessions don’t reelect presidents.  Because people don’t like recessions.  People have little money to spend on the ‘luxuries’ (dinner out, movies, vacation, etc.) in life.  And barely have enough to pay for the necessities of life.  So the high price of gasoline does not make a happy constituent.  And if you need a happy constituent to reelect you, the smart money is bet on making the constituency happy.  By bringing down gasoline prices.  Which we know how to do.  President Obama has shown us.  You simply Increase the amount of oil in the market. 

So far, drawing down the Strategic Reserve is the only thing his administration has down to increase the supply of oil.  He stopped drilling in the Gulf of Mexico.  And new drilling permits have not exactly been flying out of Washington.  But there’s still hope.  Thanks to our good friends to the north.  Who have some of the largest oil reserves in the world.  And only need a way to get it to the American refineries.  Which Obama can make happen.  By saying ‘yes’ to an oil pipeline (see China eyes Canada oil, US’s energy nest egg by Rob Gilles, Associated Press, posted 6/26/2011 on Yahoo! News).

In the northern reaches of Alberta lies a vast reserve of oil that the U.S. views as a pillar of its future energy needs.

China, with a growing appetite for oil that may one day surpass that of the U.S., is ready to spend the dollars for a big piece of it.

The oil sands of this Canadian province are so big that they will be able to serve both of the world’s largest economies as production expands in the coming years. But that will mean building at least two pipelines, one south to the Texas Gulf Coast and another west toward the Pacific, and that in turn means fresh environmental battles on top of those already raging over the costly and energy-intensive method of extracting oil from sand.

Uh-oh.  Environmental battles.  You know what that means?  No relief at the pump.  Not from this administration that set green energy as the cornerstone of its economic recovery.  I mean, lowering the price of gasoline so people don’t remember the vacation that wasn’t come election time is one thing.  But making gasoline cheap and plentiful?  In an administration with Steven (somehow we have to figure out how to boost the price of gasoline to the levels in Europe) Chu as Energy Secretary?  Not going to happen.

Critics dislike the whole concept of oil sands, because extracting the oil requires huge amounts of energy and water, increases greenhouse gas emissions and threatens rivers and forests. Keystone XL, the pipeline that would bring Alberta oil to Texas Gulf Coast refineries to serve the U.S. market, compounds the issue…

Environmental groups want [President Obama] to reject it, seeing it as a test of Obama’s will to fight climate change.

The Chinese may likely get their pipeline.  But the environmentalists will be pressuring Obama to just say ‘no’.  So get used to those high prices.  They’ll probably be around for a long time to come.  At least until 2012.

The Rich get Richer, We get Poorer and Senators get Bigger Offices

People are getting richer than ever before.  Even during the Great Recession.  Some feel it’s not fair.  Especially those who hate corporate America (see The rich aren’t like you and me by Michael Winship posted 6/27/2011 on Salon).

The annual wealth report by Merrill Lynch and Capgemini finds that the assets of these so-called “high net worth individuals” reached $42.7 trillion in 2010, a rise of nearly ten percent from the previous year at a time when, as The Guardian observed, “austerity budgets were implemented by many governments in the developed world…”

Ernest Hemingway claimed that when F. Scott Fitzgerald once said to him, “The rich are different from you and me,” he archly replied, “Yes, they have more money.” Whether it’s true or not, the Hemingway in the story got it wrong. The rich not only have more money, they have more power, more clout — and more to hide.

Interestingly, this hasn’t changed during the Obama administration.  In fact, crony capitalism has never been better.  Bailouts for friends on Wall Street.  GE with a booming green energy business thanks to Obama’s green energy initiatives (and who are NOT, by the way, paying any income taxes).  Automotive bailouts that favored the UAW over actual stakeholders.  Oh, it’s good to be king.  And part of the ruling elite.  Now it’s time to reward them for a job…done (see Senators Stay Put in Hideaways by Daniel Newhauser posted 6/27/2011 on Roll Call).

A number of long-serving Senators are sitting out this year’s draw for coveted hideaways…

It’s a Senate tradition that is a cross between “Trading Spaces” and the NBA draft. Every two years, after some of the longest-serving lawmakers retire or pass away, the remaining Senators start the process of shuffling spaces, seeking to enhance their status with a coveted secret office.

The Great Recession lingers on because of high gasoline prices caused by government policies that hinder bringing more oil to market.  George W. Bush and Dick Cheney never did anything like this to drive up the price of oil.  And they were oilmen.  Who would have profited handsomely from high oil prices.  As the Democrats and the mainstream media pointed out endlessly as gasoline prices entered $4/gallon territory.  No such accusations now.  Just silence.  As the Obama policies leave a swath of destruction across the fruited plain.  Congress could do something about this.  But there is more important business to attend to.  Namely, showing other senators who has a bigger office.

Four of the 10 longest-serving sitting Senators decided it was time for an upgrade, including Hatch, who snagged the legendary space once occupied by the late Sen. Edward Kennedy (D-Mass.), and Levin, who moved into the impressive hideaway of former Sen. Chris Dodd (D-Conn.).

Hatch said his elegant new third-floor office, with a fireplace, large windows and high arched ceilings, is a significant upgrade, especially because it is just paces from the Senate floor.

And a nicer office.  Elegant?  Fireplace?  High arched ceilings?  What is this?  Imperial Rome?  Some get so upset when the rich get richer but when the people’s representatives, our servants, live just as good as the rich there is barely a whisper of disapproval.

Leahy, meanwhile, said he was in no hurry to move.

“Why would I want to give up mine?” he asked. “I’ve got the most beautiful view probably in the whole Capitol.”

An avid photographer, the second-most-senior Senator, brandishing a professional-grade digital camera, scrolled to a freshly snapped photo to prove his case.

“Recognize that guy?” he asked Wednesday, pointing to a man clad in familiar orange-tinted sunglasses, his arm casually resting on a balcony ledge looking out on a spectacular view of the Washington Monument. “It’s Bono.”

The seven-term Senator is the proud inhabitant of a first-floor hideaway, formerly the stomping grounds of the late Sen. Ted Stevens (R-Alaska). With a fireplace, built-in bookshelves, a private bathroom and a balcony, it is a rare gem among the Capitol’s hidden offices, and certainly enough to impress even a rock star.

This is your U.S. Senate.  Taking care of the people’s business.  Totally insulated from the Great Recession.  While taking the time to swoon over celebrities.  From the balcony of a gem of a hidden office.  It would appear that the rich are not the only ones who have more money, more power, more clout — and more to hide.

Out of Touch with American People

The Left attacked Ronald Reagan and George W. Bush as being out of touch with the American people.  Tax breaks for the rich.  And spending cuts for the poor.  That neither saw the suffering masses their policies created.  Well, President Obama is addressing this income disparity.  By making everyone poorer.  Except, of course, his cronies who are generous with the campaign cash donations.

The high cost of gasoline is hurting Americans and keeping the Great Recession alive and well.  And we can blame Barack Obama now for the high cost of gasoline.  By restricting the supply of oil to the market.  Because more oil means lower gas prices.  (Obama proved he knows this by drawing down the Strategic Reserve to do just that.)  His administration placed a moratorium on drilling in the Gulf of Mexico.  His administration is making it difficult to get drilling permits.  And now his administration may say ‘no’ to that pipeline from the Alberta oil sands to the Texas Gulf Coast.  Or delay saying ‘yes’ for as long as possible to appease the environmentalists.  Meanwhile, the Chinese will move ahead and do whatever it takes to get that Canadian oil.  Because without oil a modern economy will grind to a halt.  And no amount of windmills or solar panels will change that. 

The Chinese know this.  And they’ll probably get that Canadian oil while the Obama administration is still dithering over the environmental impact of the proposed pipeline.  Completely indifferent to the plight of struggling American families.  And quite happy to sit by and watch the price of gasoline get to European levels.  To advance their green energy policies.  So they can reward their most generous cronies.

And it was Ronald Reagan and George W. Bush who were out of touch with American people?

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