President Obama and his obedient lap dogs are out in full force this week attempting to convince voters that those evil guys on Wall Street have moved on from destroying the value of their homes to artificially raising the price of gasoline. Soon they are coming for your first born. From one of Obama’s speeches this week:

So today, we’re announcing new steps to strengthen oversight of energy markets.  Things that we can do administratively, we are doing.  And I call on Congress to pass a package of measures to crack down on illegal activity and hold accountable those who manipulate the market for private gain at the expense of millions of working families.  And be specific.

First, Congress should provide immediate funding to put more cops on the beat to monitor activity in energy markets.  This funding would also upgrade technology so that our surveillance and enforcement officers aren’t hamstrung by older and less sophisticated tools than the ones that traders are using.  We should strengthen protections for American consumers, not gut them.  And these markets have expanded significantly.

Now the ability to place blame for rising gasoline prices on Wall Street (or Republicans) is good politics, but its not true. The Center for American Progress report linked to above, chillingly titled “Is Big Oil Rigging Gasoline Prices?” begins by alerting the reader to the fact that the American people, having been polled, believe that Wall Street must be behind the recent rise in gasoline prices. Apparently the average American’s opinion on financial speculation, oligopoly pricing, and their link to gasoline prices is sufficiently meaningful to include in an article not accusing Big Oil of manipulating oil prices, but just putting the question out there. I hastily blogged about that report here, as did the editors of RealClearEnergy.

Obama pulled the exact same stunt last year. He set up some sort of task force/executive agency/working group/etc. to make sure that there isn’t any illegal price manipulation going on. The agency never found anything, and its unclear if they even really did any investigating:

Pressed by McClatchy for details on how an active working group would be reconstituted, Carney said simply that rising prices are a worry now.

“What we are seeing now in the last several weeks and months is a new surge in the price of oil for a variety of reasons that have to do with the global oil market,” he said. “We are seeing then the concurrent spike in the price of gasoline that Americans pay at the pump, and the president believes that it’s important to be sure that there’s no fraudulent speculation involved in that — in those spikes in the price.”

As to why restart a working group if it didn’t find anything last year and went dormant, Carney offered that, “you don’t know until you investigate what you might find. And whatever they found or didn’t find a year ago is not dispositive towards what they might find or might not find as they investigate going forward.”

Just days earlier, McClatchy asked in a March 1 report what the task force had done over the past 10 months; the answer was, very little. Administration sources who spoke on condition of anonymity because they weren’t authorized to say such embarrasing truths acknowledged that the working group had met only five times last year, three of those soon after the April 21 formation of the inter-agency task force. The working group now has met seven times in all, the Justice Department said Thursday.

It’s less embarrassing when you realize this is nothing more than a political stunt designed to convince voters that Obama is doing something about high gasoline prices. From here we take it away to an excellent post by an economics professor/blogger on a similarly ridiculous op-ed in the NYT:

Let me close by pointing those interested in this issue to a recent survey of academic studies of the role of speculation by Bassam Fattouh, Lutz Kilian, and Lavan Mahadeva. The authors conclude:

We identify six strands in the literature corresponding to different empirical methodologies and discuss to what extent each approach sheds light on the role of speculation. We find that the existing evidence is not supportive of an important role of speculation in driving the spot price of oil after 2003. Instead, there is strong evidence that the co-movement between spot and futures prices reflects common economic fundamentals rather than the financialization of oil futures markets.

And another post, by Craig Pirrong, an expert in energy markets who pulls no punches:

In sum, the parts of Obama’s markets aimed at speculator-manipulators are intellectually confused, empirically baseless, and deeply irresponsible because they encourage a witch hunt atmosphere by slandering (by slimy insinuations) legitimate market actors as criminal manipulators.

Well played.  Because of all the practice, no doubt.

A few other things stand out.  First, he repeats the “we use more than 20 percent of the world’s oil and we only have 2 percent of the world’s proven oil reserves” mantra.  Hell, even he admits he says this repeatedly: “But as I’ve said repeatedly.”  Repetition of a dubious factoid does not make the conclusion it is intended to support true. Indeed, that’s a staple of the Big Lie.

Second, he continues to take credit for increased US oil output when in fact he and his administration don’t have a damn thing to do with it, except that it could have been higher yet without some of their counterproductive policies.

Third, take a look at this remark: “We’ve added enough new oil and gas pipeline to circle the Earth and then some.”  To which my first response is:  What do you mean “we” kimosabe? Again, a guy who has never done anything that would risk getting a callous taking credit for the actions of those that actually put hands to shovel and made some truly shovel ready projects realities.  Moreover, it raises the question: if building so much pipeline capacity is such a great thing, why is he doing everything in his power to stall or stop Keystone?  Is that uniquely damaging? (To the environment, I mean, not to the fortunes of Buffett’s BNSF.)

A rule of thumb to keep in mind.  Whenever Obama talks about energy generally, and speculation specifically, it is safe to conclude you are being manipulated: that’s not at all speculative.

Read the rest here. It’s definitely disconcerting that the President is denigrating a completely legitimate, and valuable, aspect of our market economy.

Professional environmentalists are cheering President Obama’s rejection of construction permits for the KeystoneXL Pipeline. They are the only ones cheering, aside from a few NIMBY groups and The New York Times Obama’s always-loyal damage control cohorts. Even The Washington Post voted against Obama in this struggle. The pipeline was a small, but important part of our energy infrastructure and none of the arguments put forth against construction of the KeystoneXL Pipeline are convincing.

1. An initial argument claims that the KeystoneXL Pipeline will somehow not provide energy security for the United States.

Because consumers from around the country (and the world) use oil, pipelines are necessary to transfer mind-bogglingly large amounts of it around the country each day. Imagine a scenario where we randomly begin shutting down oil and natural gas pipelines around the United States. The obvious result of decreasing our capacity would be decreased security, as we are less capable of moving oil around our country to deal with shocks, disasters, etc. Now think about what adding a pipeline does: it increases our capacity to transport oil around the country. Ultimately, this must increase to some extent our energy security.

One reason that environmentalists claim no ‘energy security’ benefits is because they believe (or claim to believe) that all of the oil is destined for export.  This is unlikely. As you may well know, the U.S. imports a good chunk of its oil from Canada/Mexico already, but also imports roughly 40% of our petroleum from countries outside the Western Hemisphere, including Saudi Arabia, Nigeria, Venezuela, Russia, etc. These non Canadian/Mexican imports must be transported across the Atlantic Ocean, and as Michael Levi notes, its unlikely that it will not ultimately be cheaper to decrease some of our imports from across the Atlantic Ocean, and increase our Canadian oil imports.

Finally, the pipeline would be a good idea even if all the oil is exported, as refiners in the Gulf will profit from the value they add as the oil is refined into gasoline, diesel, etc.

2. Environmentalists claim that gasoline prices will increase for Americans if the pipeline is approved.

This claim is ironic, as the ultimate goal of some of the more seasoned environmental veterans is to make energy (including gasoline) more expensive. Apparently this isn’t selling point for environmentalism has yet to resonate with Americans. So it’s clear that this is a bait-and-switch in terms of appealing to the average American who, at this point, does not want gasoline prices to go up.

Regardless, the effect that the pipeline has on the price of gasoline in the United States shouldn’t change the merits of the project. Some have argued that gasoline is a bit under-priced in the Midwest at the moment because there is a glut of supply and not a ton of outlets for the oil. If supplies tighten in the Midwest, they will loosen elsewhere, including hopefully refineries on the Gulf Coast. And if they happen to result in higher prices in the Midwest and lower prices globally, this is also not something we should attempt to stop. Americans generally understand that trade restrictions make us all worse off, and that free trade is beneficial. Blocking the pipeline is a form of economic protectionism, its just slightly more hidden in the form of a regulation rather than a tariff.

3. The environmentalists claim that job projections are vastly inflated.

Industries lobbying for certain policies or projects exaggerate their beneficial effects, news at 11. It’s obvious that increased economic activity will add jobs, quibbling over the numbers is pointless. I will also point out that the same groups don’t have issues with accepting obviously inflated jobs numbers when the jobs involve installing windmills, solar panels, or cleaning up power plants.

4. The pipeline is “game over” for the climate. This line came from our country’s esteemed scientist James Hansen, and was delivered by assuming (1) that the oil would sit in the ground without the pipeline, and (2) that the entirety of the oil sands will be developed. Neither premise is likely. The oil can quite likely find an additional route to Asia (there’s too much money for the Canadian government in this to leave it all in the ground). Ironically, the 2nd-best route chosen by TransCanada will almost certainly be less efficient than the original planned route, and could ultimately increase carbon emissions especially if they begin shipping it directly to China. Moreover, to get the carbon dioxide emissions Hansen described (2ooppm) would take until the year 3316. Even if that number is off by a significant amount, we don’t plan even 100 years into the future (for good reason, we have no idea the effects of new technologies, etc.).

Finally, even if you agree that it is in the world’s best interest to begin drastically scaling back carbon dioxide emissions (and that the international will-power exists to do this or that its a good idea to proceed without international agreement), the oil sands are still going to be developed. The oil sands are only 5-10% more carbon intensive than a standard baseline for oil production, and would proceed even with a moderate price on carbon. Cheap carbon reductions are more likely to come, initially, from electricity production rather than oil production. Carbon free alternatives to carbon-intensive electricity production are much closer to working on a scale that would be necessary when compared with substitutes for oil, which are mostly non-existent except for the ever-fledgling biofuels industry.

**

Ultimately, the President kowtowed to a small special interest group that will play a pivotal role in his re-election, despite the conflict with other labor groups who supported construction of the pipeline. Somehow, environmentalists are happy, despite the high probability that this pipeline will still soon be built, perhaps even with President Obama’s blessings in 2013.

The Republicans may have screwed up by forcing Obama to decide on the pipeline (and giving him an excuse that he could sell to the public), though this issue will remain a large symbol in the 2012 campaign(s). Indeed, many centrist Democrats have already distanced themselves from the President’s decision.

The Administration’s reasoning for rejecting the permit is mostly bogus. They might have a legal excuse, but there are hundred’s of thousands of miles of pipelines around the U.S., and they cause no serious problems. If Obama is upset that Republicans have pushed him towards an “arbitrary” deadline, he must acknowledge that Republicans are upset that the President began this debacle by playing politics with our nation’s energy needs.

The pipeline is being routed away from what was claimed to be an environmentally sensitive area (which, many experts including the State Department, don’t really believe) to a safer area, yet we have to spend months and months studying the new route? It is overwhelmingly likely that there will be absolutely nothing wrong with the new route, and this is just a standard tactic to delay a politically tough decision.

We will see what happens in the months to come.

Coming out of The New York Times of all places, “Number of Green Jobs Fails to Live Up to Promises.” Unsurprisingly, it has the green groups riled up.

A study released in July by the non-partisan Brookings Institution found clean-technology jobs accounted for just 2 percent of employment nationwide and only slightly more — 2.2 percent — in Silicon Valley. Rather than adding jobs, the study found, the sector actually lost 492 positions from 2003 to 2010 in the South Bay, where the unemployment rate in June was 10.5 percent.

Federal and state efforts to stimulate creation of green jobs have largely failed, government records show. Two years after it was awarded $186 million in federal stimulus money to weatherize drafty homes, California has spent only a little over half that sum and has so far created the equivalent of just 538 full-time jobs in the last quarter, according to the State Department of Community Services and Development.

The weatherization program was initially delayed for seven months while the federal Department of Labor determined prevailing wage standards for the industry. Even after that issue was resolved, the program never really caught on as homeowners balked at the upfront costs.

(Note that it took seven months, as in 210 days or almost 60% of a year, to figure out wage standards for an industry. Good enough for government work.)

This isn’t the first report on the green jobs fiasco. There are numerous reports of outrageous amounts of money spent “creating” very few jobs. There are reports of stimulus-receiving green-tech factories closing (or moving abroad), some after receiving praise from Obama himself.  Could the failure of promoting ‘green’-jobs have been predicted? Well, you could have looked at Spain, or Germany.

Finally, does the Times seem pessimistic on the results of the Brookings Institute study? Because that’s not the impression I got from reading certain other blogs, which loudly cheered the alleged 2.7 million green jobs. Upon closer inspection, it turns out that a large portion of those jobs are in fields not traditionally seen as representing the future of green-technology, such as waste management or mass transit services. It’s also worth noting that the ‘number of jobs saved or created’ should be secondary to the amount of wealth produced. The fewer workers necessary to produce this (again, contra the green blogs who snub the oil industry for its efficiency), the more workers freed up to focus on other parts of the economy.

It is rumored that President Obama is set to announce another attempt at job creation later this fall. Let us hope that he avoids the ‘not actually shovel ready’ green jobs approach and instead focuses on liberating the economy.

Quebec, long an economic basket case kept afloat by Canada’s federal government, has decided to open up its northern interior to resource development.  Quebec Premier Jean Charest announced on Monday an ambitious 25-year “Plan Nord” to build highways, airports, and other infrastructure so that the area can be developed.

According to Montreal’s Gazette, “Investments in energy development, mining, forestry, transportation, and tourism in the 1.2-million-square-kilometre region – twice the size of France – will create 20,000 jobs a year, generating $162 billion in growth and tax revenues of $14 billion.”   Large parts of northern Quebec are heavily forested, and there are major deposits of iron, nickel, gold, platinum, cobalt, zinc, vanadium, and rare earths.

The Obama Administration should follow Quebec’s good example.  The Department of the Interior and the U. S. Forest Service (an agency of the U. S. Department of Agriculture) control nearly 30% of the land in the United States, most of it in the West and Alaska, plus the Outer Continental Shelf.  Federal lands and offshore areas contain colossal reserves of energy and minerals plus the most productive forests in the world.  But the Obama Administration is locking up more and more federal lands and offshore areas in order to prevent oil and gas production, hardrock mining, and timber production.  And they’re trying to block coal mining in Appalachia by inventing new pollutants to be regulated.

Given the federal government’s looming insolvency, only environmental pressure groups could think that this resources lockup is good public policy.  At least the  House of Representatives, led by Rep. Doc Hastings (R-Wash.), Chairman of the Natural Resources Committee, is trying to force the Obama Administration to increase oil and natural gas production in federal offshore areas.  Last week, the House passed the first of three offshore bills and is going to vote on the other two this week.

H. R. 1229, 1230, and 1231, if enacted, would increase U. S. oil production by several million barrels a day and thereby reduce our trade deficit by hundreds of billions of dollars and create hundreds of thousands of high-paying jobs.  Moreover, unlike the clean energy economy and green jobs that President Obama keeps promoting, increasing oil production in the Outer Continental Shelf does not require taxpayer-funded subsidies.  Instead, oil companies pay billions of dollars at competitive auctions for the right to drill in federal waters and then pay royalties on every barrel of oil produced.

The semi-socialist government of Quebec gets it; the House of Representatives gets it; but unfortunately President Obama and his administration do not get it.  They insist on living in a fantasy land where federal spending rather than natural resource production creates economic activity.

The ethanol industry has found a friend — the US Department of Agriculture. The industry will be less reliant on new legislation to encourage ethanol consumption, thanks to a new USDA announcement that the department will begin funding grants and loan guarantees for gas stations that choose to install new E-85 blender pumps. This was one of the primary legislative goals of the renewable fuels lobbyists.

The funding for the program will be provided by the 2008 farm bill which included funding that can be used to promote renewable energy development. The total fund amounts to $70 million in 2011 and another $70 million in 2012.

From the article:

Most gasoline sold in the U.S. is 10% ethanol, but a growing fleet of flexible-fuel vehicles can run on an 85%-ethanol blend, or E85. However, there are fewer pumps available to dispense it, Mr. Vilsack said.

In the U.S., only about 2,350 fueling stations out of more than 110,000 offer E85 pumps, according to the USDA.

It’s obvious why gasoline retailers are hesitant to install E-85 pumps, adjusting for energy content its not a better deal than gasoline.

When really pressed on why the USDA and the Obama administration continue to support corn based ethanol, they point to using it as helping support the fledgling cellulosic ethanol industry, which seems to always be just 5 years away from commercial viability.

The House of Representatives this afternoon passed H. R. 910, the Energy Tax Prevention Act, by a vote of 255 to 172.  Nineteen Democrats voted Yes.  No Republicans voted No.  This is a remarkable turnaround from the last Congress when on 26th June 2009 the House voted 219 to 212 to pass the Waxman-Markey cap-and-trade bill.

The Energy Tax Prevention Act, sponsored by Rep. Fred. Upton (R-Mich.), the Chairman of the Energy and Commerce Committee, would prohibit the Environmental Protection Agency from using the Clean Air Act to regulate greenhouse gas emissions and thereby put a potentially huge indirect tax on American consumers and businesses.   Coal, oil, and natural gas produce carbon dioxide, the principal greenhouse gas, when burned.  Those three fuels provide over 80% of the energy used in America.  Thus regulating carbon dioxide emissions essentially puts the EPA in charge of running the U. S. economy.

This is just the first step in stopping the Obama Administration’s attempt to raise energy prices .  The House bill now heads to the Senate, where yesterday an attempt to add the Energy Tax Prevention Act (introduced in the Senate as S. 482 by Senator James M. Inhofe of Oklahoma) as an amendment to another bill was defeated on a 50-50 vote.  Minority Leader Mitch McConnell’s amendment would have required 60 votes to be attached to S. 493.  Four Democrats joined 46 Republicans in voting for the amendment–Senators Joe Manchin of West Virginia, Mary Landrieu of Louisiana, Ben Nelson of Nebraska, and Mark Pryor of Arkansas.  Senator Susan Collins of Maine was the only Republican to vote No.

The strong House vote in favor of the Energy Tax Prevention Act should build new momentum to pass it in the Senate later this year.  Of course, the White House has already issued a veto threat, which shows that President Obama is not interested in creating new jobs and restoring prosperity to America.  Congress has now rejected cap-and-tax resoundingly, but the President still hopes to achieve through backdoor regulation his goals of skyrocketing electric rates and gasoline prices at the $10 a gallon European level.

At The Huffington Post, Jeffrey Rubin writes: “Only a Recession Can Deliver Obama’s Energy Targets.”

Unfortunately, we have heard this song many times before. In 1973, President Richard Nixon unveiled “Project Independence” in response to the OPEC oil embargo that was triggered by the Arab-Israeli war. President Jimmy Carter called the need to lessen U.S. dependence on Middle Eastern oil the moral equivalent of war in response to the supply disruptions that followed the Iranian Revolution. President George Bush Jr. referred to America’s dependence on foreign oil as nothing short of an addiction.

Over the past four decades, U.S. presidents have waxed eloquent about the need to reduce the country’s dependence on imported oil. Yet the U.S. economy still relies on imports for more than 50% of the 19 million barrels of oil burned every day. As a result, the U.S. remains as vulnerable to soaring oil prices as it was during the OPEC shocks in the 1970s.

Rubin notes that we’ve been down this road before. Eloquent speeches aside, governments haven’t historically had the ability to make significant changes to the types of energy that are economically viable. But don’t get your head down, repeated failure has never stopped our government.

Concluding, he writes:

So far, recessions have been the only surefire way America has cut back on its fuel consumption and the need for oil imports. But, of course, that is not an option any U.S. president can pursue.

Maybe not, but maybe? (from E&E News, $ub. required):

Yesterday, all eyes were on the United States as country after country asked [U.S. Deputy Special Envoy for Climate Change Jonathan] Pershing to explain specifically how America will meet the promise that Obama made the world at the 2009 Copenhagen, Denmark, climate change summit. He noted in a series of slides that U.S. emissions have declined about 8.7 percent since 2005 — and while he acknowledged that a portion of that is due to the economic downturn, Pershing insisted that the more important metric is whether America is meeting its target.

Health of the economy be damned, our emissions declined!

In his speech earlier this week, President Obama took a brave and unprecedented stand against our nations reliance on foreign petroleum imports:

Now, here’s a source of concern, though. We’ve known about the dangers of our oil dependence for decades. Richard Nixon talked about freeing ourselves from dependence on foreign oil. And every President since that time has talked about freeing ourselves from dependence on foreign oil. Politicians of every stripe have promised energy independence, but that promise has so far gone unmet.

I talked about reducing America’s dependence on oil when I was running for President, and I’m proud of the historic progress that we’ve made over the last two years towards that goal, and we’ll talk about that a little bit. But I’ve got to be honest. We’ve run into the same political gridlock, the same inertia that has held us back for decades.

That has to change. That has to change. We cannot keep going from shock when gas prices go up to trance when they go back down — we go back to doing the same things we’ve been doing until the next time there’s a price spike, and then we’re shocked again. We can’t rush to propose action when gas prices are high and then hit the snooze button when they fall again. We can’t keep on doing that.

The United States of America cannot afford to bet our long-term prosperity, our long-term security on a resource that will eventually run out, and even before it runs out will get more and more expensive to extract from the ground. We can’t afford it when the costs to our economy, our country, and our planet are so high. Not when your generation needs us to get this right. It’s time to do what we can to secure our energy future.

Richard Nixon wasn’t the only one. As Jon Stewart pointed out last summer, the last eight administrations have warned against the alleged dangers of importing petroleum and provided a number of solutions to massively restructure the economy, none of which were successful. Stewart comments, “Fool me once, shame on you. Fool me twice, shame on me. Fool me eight times, am I a ****ing idiot?”

And yet we appear to be idiots, and more money will  be spent chasing pipe dreams with taxpayer money. The New York Times, today, congratulated Obama’s willingness to take on such a tough challenge and blamed the lack of progress on, wait for it, Republicans:

Beset by rising gas prices and Middle Eastern turmoil, Mr. Obama, like other presidents, decried the nation’s dependence on foreign oil. He also said there were no quick fixes and that a nation with only 2 percent of the world’s reserves cannot drill its way to self-sufficiency.

He then offered a strategy aimed at, among other things, reducing oil imports by one-third by 2025, partly by increasing domestic production but largely by producing more efficient vehicles and by moving advanced biofuels from the laboratory to commercial production.

These are achievable goals. Reducing oil imports by one-third means using 3.7 million fewer barrels a day. The fuel economy standards set last year by the Environmental Protection Agency and the Department of Transportation will yield 1.7 million of those barrels; the next round of standards, now on the drawing boards at the E.P.A., will yield another 1.7 million barrels. Advanced biofuels and improved mass transit could get us the rest of the way.

None of these goals will be reached if the Republicans who dominate their party have their way. One particularly destructive amendment to the House’s irresponsible budget bill would strip the E.P.A. of its authority to regulate greenhouse gases from vehicles and stationary sources.

It would be great if biofuels and mass transit could get us all the way there, but they can’t. Despite decades of subsidies, corn ethanol has been unable to match the price of gasoline. The U.S. has yet to see even a fraction of 1% of our annual vehicle fuel consumption come from the *insert other hypothetical alternative fuel here* craze, but I’m sure an economically viable breakthrough is right around the corner. Electric vehicles might become the hybrid vehicle of the future, but don’t expect Americans to be convinced unless the range, charging capability, and price issues are solved. High speed rail isn’t thought to pass the cost-benefit test in most areas of the United States.

Republicans are certainly responsible for political gridlock right now (a great thing, one might argue), but plenty of attention has been paid towards these technologies by both sides of the aisle in past years.

Let’s acknowledge the irony here. From a copy of Obama’s prepared remarks today at Georgetown University discussing his administration’s energy plan:

But here’s the thing – we’ve been down this road before.  Remember, it was just three years ago that gas prices topped $4 a gallon.  Working folks haven’t forgotten that.  It hit a lot of people pretty hard.  But it was also the height of political season, so you had a lot of slogans and gimmicks and outraged politicians waving three-point-plans for two-dollar gas – when none of it would really do anything to solve the problem.  Imagine that in Washington.

The truth is, of course, was that all these gimmicks didn’t make a bit of difference.  When gas prices finally fell, it was mostly because the global recession led to less demand for oil.  Now that the economy is recovering, demand is back up.  Add the turmoil in the Middle East, and it’s not surprising oil prices are higher.  And every time the price of a barrel of oil on the world market rises by $10, a gallon of gas goes up by about 25 cents.

President Obama is decrying gimmicks and slogans (as he should be), noting their inability to achieve anything, with his newest slogan “Win the Future” in the background.

“WTF” indeed.

The most astonishing event this week was President Barack Obama endorsement of more oil production—in Brazil.  In a speech to a CEO Business Summit in Brasilia, the President said:

By some estimates, the oil you recently discovered off the shores of Brazil could amount to twice the reserves we have in the United States.  We want to work with you.  We want to help with technology and support to develop these oil reserves safely, and when you’re ready to start selling, we want to be one of your best customers.  At a time when we’ve been reminded how easily instability in other parts of the world can affect the price of oil, the United States could not be happier with the potential for a new, stable source of energy.

This is the same President who has spent the last two years doing everything he can to reduce oil production in the United States.  Cancelled and delayed exploration leases on federal lands in the Rocky Mountains; the re-institution of the executive moratorium on offshore exploration in the Atlantic, the Pacific, most Alaskan waters, and the eastern Gulf of Mexico; the deepwater permitting moratorium and the de facto moratorium in the western Gulf.  The result is that domestic oil production is about to start a steep decline.  An article on Red State by Steve Maley summarizes the future effects of the Obama Administration’s war against oil.

Maley quotes an authoritative summary (PDF) provided in a recent publication by the Department of Energy’s Energy Information Administration:

Off shore oil production in [the 2011 forecast] is lower than in [the 2010 forecast] throughout most of the projection period [through 2035] because of expected delays in near-term projects, in part as a result of drilling moratoria and in part due to the change in lease sales expected in the Pacific and Atlantic outer continental shelf (OCS), as well as increased uncertainty about future investment in off shore production. [page 8]

I’m all for more oil production in Brazil, but what’s good for Brazil would also be good for the United States.  Were the federal government to open some of America’s vast untapped offshore and Alaskan oil resources, it would lower our trade deficit by hundreds of billions of dollars, provide billions of dollars in royalties to the federal treasury, create hundreds of thousands of high-paying jobs not subsidized by taxpayer dollars, and contribute significantly to our long-term prosperity.  Given the economy’s current dismal long-term prospects, continuing to lock up our resources is detestable.

President Obama’s remarks in Brazil show that he understands this.  He clearly thinks prosperity is good for Brazil.  But it is something that he is working mightily to deny to Americans.  He and his administration have adopted policies that they know will reduce oil and coal production, raise energy prices, and make Americans poorer.  As the President said when gas prices reached $4 a gallon in the summer of 2008 when he was running for President, the problem wasn’t the price, but that prices had risen too suddenly. In fact, the Administration is full of senior officials who are on record supporting much higher gasoline and electricity prices, starting with Energy Secretary Steven Chu.

Victor Davis Hanson takes a stab at explaining the background assumptions that have led to the left’s insane war against energy:

The administration’s energy visions are formulated by academics and government bureaucrats who live mostly in cities with short commutes and have worked largely for public agencies. These utopians have no idea that without reasonably priced fuel and power, the self-employed farmer cannot produce food. The private plant operator cannot create plastics. And the trucker cannot bring goods to the consumer — all the basics like lettuce, iPads, and Levis that a highly educated, urbanized elite both enjoys and yet has no idea of how a distant someone else made their unbridled consumption possible.

I think that’s part of the explanation, but only scratches the surface.  At its core, the modern environmental movement (and the Obama Administration has been staffed with professional environmentalists) hates access to energy because it gives people power over nature.