BCT Editorial – 4/14/06

This page was last updated on April 14, 2006.

Warning signs; Editorial; Beaver County Times; April 14, 2006.

Below is a detailed critique of the subject editorial.

“Americans have only themselves to blame for gas-price crunch

“The price of gasoline could top $3 a gallon at the pump this year - and keep climbing.

“That has led to a national whine voicing resentment against oil companies and oil-producing countries, usually of the Middle Eastern persuasion.

“But the American people have only themselves to blame for this situation. They have been told for years that this day of reckoning was coming and chose to ignore the warnings.”

[RWC] You will note throughout the editorial the author constantly refers to “the American people,” “the American public,” “Americans,” “they,” et cetera. Not once did the author use the pronoun “we.”

“Instead of buying fuel-efficient vehicles, Americans demanded bigger, gas-guzzling SUVs and trucks. Instead of expanding mass transit systems, Americans chose to build more roads on which they could ride their SUVs and trucks to work and play, often alone. Instead of buying older homes in communities, they expanded their range from suburbia to exurbia. Instead of living in communities where they could walk to shop and worship, they opted for 20- to 30-minutes rides to get anywhere.

“Cheap gas made it all possible.

“It’s not as if they weren’t warned, though.

“As Americans were reveling in cheap gas, conservation advoctes [sic] were warning the nation that it eventually would pay for its addiction. They wanted the federal government to increase fuel-efficiency standards on cars and trucks, especially SUVs, but were shot down by the auto industry and the American public. They wanted a higher federal tax on oil to help fund research into alternative energy sources, but were derided as tree huggers. They wanted more funding for mass transit, but were told to take a hike. They wanted urban policies that cut down on suburban and exurban sprawl, but were dismissed as being out of touch with the real world.”

[RWC] Though there are some exceptions, usually the rank and file, you’ll find most “conservation advocates” are simply liberal political activists.

“They weren’t just ignored; they were scorned, with Vice President Cheney famously labeling energy conservation as a ‘personal virtue.’”

[RWC] I lifted this section of the critique from my critique of the editorial entitled “Beyond words” of February 2, 2006.

This will probably come as a shock to you, but the editorial took Mr. Cheney’s “personal virtue” comment out of context. Here is the context. In a speech at the annual meeting of the Associated Press in Toronto on April 30, 2001, VP Cheney spoke about nonrenewable energy sources, renewable energy sources, and conservation.

After several paragraphs describing the importance of conservation/efficiency to a sound energy policy, VP Cheney said, “Now, conservation is an important part of the total effort. But to speak exclusively of conservation is to duck the tough issues. Conservation may be a sign of personal virtue, but it is not a sufficient basis all by itself for sound, comprehensive energy policy. We also have to produce more. The American people have worked very hard to get where they are, and the hardest working are the least likely to go around squandering energy or anything else that costs money.”

It’s amazing how putting a person’s comments in context changes things, doesn’t it?

“What’s particularly telling about the current price rise is that many Americans are clueless as to its cause.”

[RWC] Note the editorial never explores the reasons why the author believes “many Americans are clueless as to” why oil prices rise. I’m sure it couldn’t be that news outlets like the Times aren’t doing their jobs to present the facts. That said, I do wonder why the Times chose to “come clean” in an editorial instead of the news pages.

“Sure, the oil companies are making tons of money, and the oil-rich nations of the world are rolling in dough. But the law of supply-and-demand and instability in many oil-rich countries are pushing up prices, not some oil executive/Arab cabal.

“On the supply-and-demand end, China and India, both oil-poor nations, have huge appetites for energy that show no signs of slackening for decades to come. Their ever-growing energy demands mean the price for a barrel of oil is not going to go down in the near future.

“The political shakiness of major oil-exporters also comes into play. Venezuela could curtail its shipments of oil to the United States on the whim of its dictator. Nigeria’s kleptocracy could be overthrown at any time by guerrillas, not to mention the instability created by the Islamic/Christian divide that boils over from time to time. Then there’s Iran, which could use oil as a weapon to counter efforts by the West to get it to end its nuclear efforts. Several Middle Eastern nations, including Saudi Arabia, could go Taliban at any time. And given the Bush administration’s post-invasion blundering, Iraq’s oil-producing reliability is always subject to doubt.”

[RWC] While there is unquestioned instability in much of the oil-producing world, there are some problems with some of the scenarios presented above.

Regarding Venezuela, it doesn’t have the kind of control described. Much of Venezuela’s crude is “heavy sour,” that is, it has a low API gravity and high sulfur content. Both of these properties make the crude more difficult (read: more expensive) to refine and results in lower value products. As a result, refineries must be designed specifically to handle these low quality crude oils, meaning that many refineries cannot process heavy sour crude oil at all. Historically, U.S. refineries have been the best equipped to handle these crudes. In any case, Venezuela crude sent elsewhere would displace other crude that would find its way to the U.S.

Regarding Iran, it cannot afford to withhold its oil from the world. Even with full production, the Iranian economy is in trouble. Some people speculate the recent Iranian “saber rattling” regarding its nuclear program and military is intended to deflect the attention of Iran’s citizens away from Iran’s economic problems.

“None of this should come as any surprise to anyone who was paying attention. The warning signs were there, and they were ignored.”

[RWC] Anybody want to bet the editorial author doesn’t have a clue how to address his perceived problem?

The answer is, “It’s the economy, stupid!” Whether you are a member of Mr. Florida’s “creative class” or not, you are attracted by vibrant economic activity. Employ conservative principles to restore economic freedom to PA’s economy and “problems” like those described in this editorial take care of themselves.