2: Off Shore Drilling

2: Off Shore Drilling

What do I think?
Off shore drilling will do nothing to affect the price of gasoline at the pump. The only thing that off shore drilling will do is to increase the profits of big oil. John McCain only supports off shore drilling because his campaign is lobbied by big oil.

Why do I think this?
Did you know that the price of oil is closely connected to the price of the dollar?

The price of oil is determined by the Oil and Petroleum Exporting Countries (OPEC). These are countries in who recognize they have a monopoly on oil, and use that monopoly to control the price of oil. Other countries that export oil do not export enough oil to compete with this monopoly. Even if the US were to produce more oil than Saudi Arabia, we would still not compete with Saudi Arabia, Iran, Kuwait, Iraq, Qatar, UAE, Libya, Algeria, Nigeria, Angola, Venzuela and Ecuador put together. People will point out that a large portion of the oil in US markets is not from the middle east, which is correct. However, much of that oil is from Venezuela and Ecuador. As a result, a huge majority of the oil consumed in the US is from OPEC. And OPEC decides the price of oil.

OPEC member countries buy US Debt. Just under 6% of the US debt (154 billion dollars) is purchased by Oil Exporting Countries. As a result, the price we pay for oil is somewhat tied to the strength of the US dollar. If the dollar weakens, oil becomes more expensive because OPEC needs to cover its potential loss on US debt. If the dollar strengthens, oil becomes cheaper so that the US can produce more, and OPEC can continue to buy US debt. Because of this, the price of oil is somewhat tied to the value of the US dollar. So, if we want to control the price of oil, we have to control the value of the US Dollar. The only way to control the value of the US dollar is to strengthen the economy.

If Big Oil were permitted to begin off shore drilling, the amount of oil brought in would not be enough to compete with the production output of the 12 OPEC nations. As a result, Big Oil would sell that oil for the same price decided upon by OPEC. It would also refine some of that oil to sell at it's own pumps. As a result, Big Oil would make more profit from gasoline sold at it's pumps, and would make money from selling oil to other companies. The price of oil however would not likely decline.

The risks of off shore drilling are enormous. If something went wrong at an off shore drilling pump, it would wreak havoc on the environment the likes of which we have not yet seen. (Imagine the Valdez, only instead of one boat, it's a pump that fills hundreds of boats, and it's not just a limited amount of oil being spilled, it's a tenfold volume of oil being pumped directly into the ocean itself.) the US government would be held responsible for the clean up efforts. Big Oil would likely be responsible for fixing it's own equipment, and the US Department of Agriculture and the EPA and FEMA would have to clean it out of the ocean. In other words, Big Oil would get all the profits, and the US citizens would assume all the risk. Privatize the profits, socialize the risk. Fannie Mae and Freddie Mac all over again.

John McCain has been against off shore drilling for most of his political career. Now, he favors it. John McCain's campaign has also been given 1.3 million dollars by Big Oil.

I believe off shore drilling will not help the average American and is only supported by John McCain because he is partially funded by Big Oil.

Barack Obama on the other hand is opposed to off shore drilling, and wants to increase our renewable resource infrastructure. The energy plans of Obama will mean more jobs to create this infrastructure, more jobs to run this infrastructure, and a dramatically reduced dependence on foreign oil. McCain's plan will mean more money for big oil, and renewable clean energy will remain a thing for tomorrow. I am with Obama here, and it's not because he's a celebrity and I'm stupid. It's because he's right and McCain is dangerously wrong.