Many financial experts are touting that the country is finally on the rebound after years of recession. Are they right? They could be correct, as a few national indicators have shown an upward trend the past few months. Even the state of Georgia recently reported that monthly revenue was up. That’s all good news.
However, one of the problems that I personally believe that led our country down the road to financial distress was the unstable fuel market. You see when the cost of fuel started rising drastically in 2008 (jumped as high as $4.00 per gallon) working-class families had to make tough decisions...“Do I pay my bills or do I pay for the gas in my car just so I can make it to work to earn a few more dollars?” Again, it is my opinion that part of the housing/mortgage crisis can be blamed on the cost of fuel and the fact that Americans overburdened themselves with too much debt.
Those prices are rising once again and are predicted to hit the $5.00 per gallon mark this summer. How much would you be willing to bet that this is going to cause a continuation of the recession?
There are many fingers being pointed by politicians right now. President Barack Obama has set his sights on big oil companies and their extreme profit margins. Not that I necessarily disagree with the President, but our own government may want to consider pointing the finger at itself as well.
U.S. House Republicans are expected to make a move to increase the country’s oil production this week by voting to lift Obama’s de facto moratorium on drilling in the Gulf of Mexico. According to the House Natural Resources Committee, “Despite officially lifting the moratorium in October 2010, the Obama administration continues to slow-walk the permitting process - imposing a de facto moratorium.”
In the proposed legislation, Secretary of Interior Ken Salazar would be required to act upon oil permit applications within 30 days of receipt. The legislation is attempting to restore oil production in the Gulf of Mexico that has been hindered by the Obama administration. According to the Energy Information Agency (EIA), Gulf oil production will decrease over the next two years by 380,000 barrels a day from its 2010 level of 1.64 million to 1.26 million. That’s a 23 percent drop. Although partially offset by increases in on-land oil production, the decrease in Gulf drilling will result in a net decrease of U.S. oil production by 150,000 barrels a day over the next two years.
President of Americans For Limited Government Bill Wilson writes that despite the fact that the 2010 oil spill has pretty much been dispersed and cleaned, and the official moratorium “lifted,” Obama has not saw fit to get Gulf drilling back up to its 2010 capacity as he sits on new permits.
Wilson continues, House Republicans are warning that the de facto moratorium is costing Americans their jobs as well, citing a study by Dr. Joseph Mason from Louisiana State University predicting “that if the de facto ban on deepwater drilling were sustained for 18 months, there could be a loss of 36,137 jobs nationwide, with 24,532 jobs lost in the Gulf Coast region alone.”
And finally he states, dubbed the “American Energy Initiative,” Republicans are promising that their legislation will “create American jobs, lower gasoline prices and reduce our dependency on unstable foreign energy.
I also read last week on foxnews.com that Shell Oil Company is abandoning drilling for oil this summer in the Arctic Ocean off the northern coast of Alaska. Why? The Environmental Protection Agency’s appeals board ruled that Shell had not taken into consideration emissions from an ice-breaking vessel when calculating overall greenhouse gas emissions from the project. The closest town to where drilling would take place...Kaktovik, Alaska - 70 miles from projected drilling. By the way the population of this remote town in Alaska is 245. I assume the EPA is worried about smog hitting downtown Kaktovik at rush hour.
Shell has invested over $4 billion dollars into this project, but I guess they are growing tired of trying to get permission from the government to drill on land they have leased at a price tag of $2.2 billion already.
To sum up this little diatribe; politicians should look in the mirror before they go pointing too many fingers.