NY Times credits Bush, Cheney with US energy surge

posted at 4:30 pm on March 24, 2012 by Jazz Shaw

I’m getting ready to start any number of conspiracy theories here. Was the New York Times website hacked by Anonymous? Did someone accidentally click on a redirect to The Onion? Did some editor at the Gray Lady suddenly suffer from a stroke and go rogue on us? In any event, as Walter Russell Mead discovers, the Paper of Record unleashed some good news on the energy front this week.

Not only has the United States reduced oil imports from members of the Organization of the Petroleum Exporting Countries by more than 20 percent in the last three years, it has become a net exporter of refined petroleum products like gasoline for the first time since the Truman presidency. The natural gasindustry, which less than a decade ago feared running out of domestic gas, is suddenly dealing with a glut so vast that import facilities are applying for licenses to export gas to Europe and Asia.

National oil production, which declined steadily to 4.95 million barrels a day in 2008 from 9.6 million in 1970, has risen over the last four years to nearly 5.7 million barrels a day. The Energy Department projects that daily output could reach nearly seven million barrels by 2020. Some experts think it could eventually hit 10 million barrels — which would put the United States in the same league as Saudi Arabia.

That’s not the amazing part. (Well, OK… it’s somewhat amazing because you’d hardly expect this particular paper to act happy about any oil exploration. But it’s not the most amazing part.) The real, spill your martini in shock and awesome bit comes in the next graph.

The Bush administration worked from the start on finding ways to unlock the nation’s energy reserves and reverse decades of declining output, with Mr. Cheney leading a White House energy task force that met in secret with top oil executives. [...]

The Bush administration also opened large swaths of the Gulf of Mexico and the waters off Alaska to exploration, granting lease deals that required companies to pay only a tiny share of their profits to the government.

Of course, they talk about it in terms of some horizon where we reach hypothetical energy independence. As we’ve discussed before, this is almost entirely an illusion. Absent the essentially socialist nationalization of the oil industry, commercial producers will find a market for every drop of oil they can process all across the globe. But it’s still good news for American jobs and insurance against supply line disruptions.

So this can cap the weekend with a love letter nobody was expecting to see. “Dear Bush and Cheney. Thanks for the successful energy policy. Love, the New York Times.”

Whodathunkit?


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The Bush administration worked from the start on finding ways to unlock the nation’s energy reserves and reverse decades of declining output, with Mr. Cheney leading a White House energy task force that met in secret with top oil executives. [...]

The Bush administration also opened large swaths of the Gulf of Mexico and the waters off Alaska to exploration, granting lease deals that required companies to pay only a tiny share of their profits to the government.

I don’t click the NY Slimes knowingly, so can only go by what is reprinted above, but you didn’t notice the language in the above paragraphs?

“Met in secret” and “companies to pay on a tiny share of their profits to the government”.

This is no love letter and I wouldn’t be surprised if the whole article had this kind of “slant” to it.

kim roy on March 24, 2012 at 8:22 PM

kim roy on March 24, 2012 at 8:22 PM

Completely agree.

Currently down here in Australia we have a government that is working from Jimmah’s playbook, in that they believe in so-called “windfall profits”.

What such people do not understand is that resources royalties represent from the mining industry the same thing as basic passbook savings accounts represent from banks: a practically zero-risk revenue stream. Governments not only do not invest in mining (unlike the US and Australian governments, who both invested heavily in automobile manufacturing over the past few years), but rather charge mining companies from the word go: exploration leases, permits, regulations, union labour requirements, company taxes, income taxes, and port/rail fees, to name a few.

And on top of all this, governments then expect a share of the profits (mineral “royalties”).

I am not against the notion of royalties as such, provided they are treated fairly as a zero-return investment, essentially a tax, for the fact that the resources exist. Like all tax regimes, raise it too high and guess what? Like it or not, you vindicate Arthur Laffer.

Finally, to any idiot who claims that governments should get higher royalties because a particular commodity is doing well in the market today – which, anyone in the resources industry knows, means eventually the price of that commodity is going to fall back – my response is,

Fine, if you believe that resource is “yours” or “ours”, go grab a shovel and mine it for yourself. Happy digging!

/leftards

Wanderlust on March 24, 2012 at 10:36 PM

kim roy on March 24, 2012 at 8:22 PM

+1
One must keep in mind the NYT’s world view. They mention increased domestic production and in their eyes this is just an increased capacity for AGW. Need we say more about attributing the opening of wider swaths of the gulf of Mexico? Didn’t think so. Add the phraseology KR points out and this is no love letter.

GregoryNeilSmith on March 24, 2012 at 11:10 PM

This article was supposed to be published on April 1.

profitsbeard on March 25, 2012 at 12:18 AM

It’s actually a trap. They are laying the groundwork for support of an argument that market conditions are good, yet the price has went up, therefore, it’s not the President’s fault!

Medbob on March 25, 2012 at 12:33 AM

kim roy on March 24, 2012 at 8:22 PM

This.

It is a giant CYA piece for President Obama and likely push back against this.

Obama gets to look like the environmental hawk that pushed up MPG standards, while the GOP is linked to Bush/Cheney (during election season no less) and they are painted as in the pocket of big oil. This is Dems getting a pass on energy, and getting it both ways, because Dems cannot look like they favor oil production. So not only is the US drowning in oil production, but it’s mostly those oil exec GOP’s “fault”.

Oh and didn’t you know? Oil companies are making record profits?

sublibertate on March 25, 2012 at 12:34 AM

And yet gas prices continue to rise which blows a hole in any theory that the Keystone pipeline or our shale oil are going to lower gas prices here. People that make that argument are either lying or have no idea how the market works.

We should be tagging any deal with big oil that increases their domestic output with a clause that makes them sell a percentage to us at lower than market prices. Since our politicians are, in part, owned by big oil this of course is never going to happen.

Benaiah on March 25, 2012 at 8:59 AM

I (new) heart Dick Cheney.

PD Quig on March 25, 2012 at 10:04 AM

Benaiah on March 25, 2012 at 8:59 AM

High gas prices do strange things.

We have the brave Newt criticized for trying to do the loves and fishes miracle and making #2.50 gas.

We have O’Reilly turning into a foxhole Chavez.

I gotta put my hero out there.

It is an economist named Mark Zandi. Wit an idea that will not complicate the tax code, make me any money, take care of donors or get us a quick fix:

Here is a quote:

In the long run, there are lots of things policymakers can and should do to make the nation more energy independent. Promoting the use of natural gas as transportation fuel seems like a slam dunk; natural gas is plentiful, cheap, and produced at home, including here in Pennsylvania. Natural gas isn’t clean, but it is cleaner than oil. Policymakers should focus on facilitating the substantial investment needed in natural gas-powered vehicles and fueling stations.

Unlocking the shale oil produced in North Dakota and Canada also makes sense. Environmental concerns should be addressed, but, given its value, shale oil will be produced one way or another. Best to do it in an environmentally coherent way, beginning with a rational policy on the pipelines needed to move oil from producers to consumers.

I’m not a fan of the energy industry’s many tax breaks, both for fossil fuel and for “green” producers. Solar, wind, and other alternative fuels may be in our future, but government isn’t good at figuring out which technologies to subsidize. The government would do better to work on making its own massive energy consumption more efficient. This could lead the way for the private sector.

Since this guy is from Pennsylvania, maybe Rick Santorum knows him.

Governor Romney, where are you?

http://www.philly.com/philly/opinion/20120325_Gas_prices_and_the_economy.html

IlikedAUH2O on March 25, 2012 at 11:50 AM

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