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June 14 2011

22:24

Koch Money Fuels AFP Misinformation Campaign On Gas Prices

The Koch-funded Americans for Prosperity (AFP) is taking their misinformation machine on the road in an attempt to convince American consumers that President Obama is causing the spike in gasoline prices. AFP is claiming that the president is intentionally keeping gas prices high because he refuses to allow oil companies to drill for oil in protected areas of the United States.

The tour is necessary for the AFP, as Americans do not believe that President Obama should be blamed for high gasoline prices. A staggering 61% of Americans say that the blame lies on the shoulders of the energy companies, and 59% say that some of the blame lies with the oil speculators. These numbers are not sitting well with the oil industry, and the AFP tour is just one of many oil industry tactics to try to shift public opinion using misinformation.

AFP’s “Running on Empty” campaign has scheduled stops in Virginia, Michigan, and Ohio in the upcoming days, to “teach” Americans about the numerous ways in which President Obama is making them pay higher prices at the pump.

AFP conveniently ignores the fact that gas prices were north of $4 a gallon during the Bush administration, when they peaked at $4.12, as pointed out by protesters who showed up at one of AFP's early gas tour events in Nebraska.  But in the alternate reality that AFP is creating to enable Koch's further oil profits, it's somehow all Obama's fault.
<!--break-->Here are the specific actions the president has taken, according to AFP, that have raised gas prices:

Illegal Moratoriums: After the Deepwater Horizon accident in the Gulf, President Obama issued a moratorium on all new offshore drilling. The message is clear: Obama is against domestic energy production.

Canceling existing oil and gas leases: Amazingly, not only has Obama blocked any new permits but he’s also reaching back and canceling drilling leases that were already in place when he took office.

Locking up lands in the West: The federal government is working overtime to make sure Americans cannot access their own domestic resources.

EPA’s job-crushing regulations (you can read the truth about these “job-crushing” regulations here.)

As we’ve covered in the past, increased domestic oil drilling will have absolutely no impact on gas prices. Oil prices are set on an international market, and since the amount of oil (and the amount of time it would take to get to market) in the U.S. is relatively small, the most significant impact it could have would be to lower gas prices by about 2 cents per gallon. But still, Republicans continue to push the myth that increasing domestic drilling will benefit all of us immediately.

And their critique of President Obama seems way off base as well. President Obama has actually been a supporter of domestic drilling, and is currently working to expand offshore drilling in the Gulf of Mexico – an area that is still awash with the remnants of oil from the Deepwater Horizon disaster last year – as well as rethinking the ban on oil drilling in ANWR. These are not the actions of an oil industry foe.

But this still isn’t enough for the Koch brothers and their Astroturf bus tour. More domestic drilling might not have a noticeable impact on our bank accounts, but those in the oil industry can expect billions of dollars in profits from increased drilling. This is why the Koch brothers, and their Americans for Prosperity front group, spent a combined $2.6 million dollars on electioneering last year alone. From the Center for Responsive Politics:

Americans for Prosperity spent $1.3 million on electioneering communications in the 2010 cycle, according to the Center for Responsive Politics.

In the 2010 cycle, the Koch Industries PAC gave $1.3 million to Congressional candidates with 90 percent going to Republicans.

The Koch Industries PAC has handed out $300,500 in contributions to federal candidates and political committees so far in 2011, according to filings with the Federal Election Commission.

The National Republican Congressional Committee (NRCC) received $45,000 from Koch Industries PAC in the 2010 cycle, falling only second to Texas Gov. Rick Perry’s (R) re-election campaign.

Charles Koch donated at least $107,900 to federal candidates and committees in the 2010 cycle (not including his donations to the Koch PAC). Top recipients included the National Republican Senatorial Committee (NRSC) with $30,400 in donations and the National Republican Congressional Committee ($24,500).

David Koch spent at least $99,291 on campaign contributions to federal candidates and committees in the 2010 cycle (not including his donations to the Koch PAC), with the NRSC receiving $34,900 and the NRCC receiving $25,000.


The Koch’s spend a lot of money to purchase, or defeat, members of Congress, and in their effort to blame Obama for high gas prices, it looks like a few Republicans are trying to pay off that Koch debt by getting their hands dirty.

Several freshman GOP Congressman have taken it upon themselves to stage “gas pumping events” at gas stations in their jurisdictions to promote the lie that the rise in price is Obama’s fault. Two of the four Republican congressman involved in these stunts – Jeff Duncan (SC) and Todd Young (IN) – have taken $2,500 and $5,000 respectively from Koch Industries.

The Koch brothers and AFP are working with seemingly limitless funds, and it is unlikely that they will allow their gas price tour to end before they are able to change at least a few people’s minds. The bigger issue is whether the Democrats and President Obama will cave into the pressure from these groups and allow more drilling in an attempt to appease the Kochtopus, which will surely be funding GOP candidates in the next election.

May 31 2011

12:15

House Republicans Distort Reality To Blame Obama For High Gas Prices

Never ones to let facts get in the way of a good political smear, House Republicans released a report blaming President Obama and the Democrats for high gas prices in America. The House Committee on Oversight and Government Reform, led by Republican Representative Darrell Issa, claims that the president has launched a concerted effort within the government to keep energy prices high in order to force “green technology” on the public.

The new report says that onerous environmental policies put in place by the administration and enforced by the EPA are causing domestic energy prices to rise dramatically, effectively killing jobs and hurting every American who drives a car. They also say that Obama is limiting oil companies’ ability to drill for "American" oil in places like the Gulf of Mexico and the Arctic National Wildlife Refuge, and that the President is not allowing them to exploit the natural resources of our country by imposing limits on hydraulic fracturing. <!--break-->
The committee went as far as to call for a full blown hearing last week, where they grilled EPA administrator Lisa Jackson and David Hayes, Deputy Secretary at the Department of the Interior, on the necessity of environmental policies that hinder domestic energy production. Here are a few highlights of the Committee’s report:

Many of the “green” energy sources promoted by the administration “create unintended environmental, security and economic consequences,” for example, by increasing the demand for Chinese “rare earth” materials, which subsequently boosts harmful coal production because that’s where more than two-thirds of China’s energy comes from.

Current administration policies have limited the domestic production of oil by restricting access to resources located along the outer continental shelf. Many of these restrictions were put in place before the disastrous Gulf oil spill.

Despite the fact that the United States relies on carbon-based fuels for more than 80 percent of its energy needs, the Obama administration has been “aggressively suppressing” the utilization of these fuels.

While their points might look good on paper or in 10-second sound bites, they are not even close to reality. For example, the GOP says that Obama has prevented industry from drilling in the Gulf of Mexico, and that he is not allowing them to drill on public lands, such as the Arctic National Wildlife Refuge. But as we’ve reported in the past, Obama has actually opened up more areas of the Gulf for drilling, and is currently actively working to open up areas of Alaska for oil drilling. Even in the wake of the BP oil disaster, he is still allowing more drilling permits for deepwater drilling.

They also ignore the fact that before the recession, and before President Obama was in office to enact any of these “price-raising policies,” American consumers were paying more than $4 per gallon of gasoline at the pump. Not surprisingly, this little nugget of information didn’t make it onto their list.

Also notoriously absent from their laundry list of factors driving up gasoline prices was the role of oil speculators. Writing for The Nation, author Chris Hayes describes how oil speculators are driving up the cost of gasoline:

In the wake of the price explosion in the summer of 2008, a bubble that extended to all kinds of commodities, including copper and wheat, a number of observers from George Soros to Hedge Fund manager Michael Masters to former Commodities Future Trading Commission staffer and derivatives expert Michael Greenberg concluded that the underlying supply-and-demand fundamentals couldn’t account for the sharp rise in prices. In the first six months of 2008, US economic output was declining while global supply was increasing. And even if supply and demand were, over the long run, pushing the price of oil up, that alone couldn’t explain the massive volatility in the market. Oil cost $65 per barrel in June 2007, $147 a year later, down to $30 in December 2008 and back up to $72 in June 2009.

The culprits, they concluded, were Wall Street speculators.

Commodities markets involve essentially two kinds of participants: there are so-called “end users” like farmers and airlines that use commodities markets as a form of insurance against future price fluctuations, and then there are speculators—hedge funds, investors, big banks that try to make money by correctly betting on those same price fluctuations.

But again, this information was absent from their new report.

There is no reason to believe that Congressional Republicans want to help lower gas prices for American consumers – their only goal is to help the oil companies that put them in office make more money. Issa, who led the hearings, has taken in more than $140,000 over his career from the oil industry, and close to $200,000 from electric utilities. The newly created House Energy Action Team is stacked with Republicans who are awash in dirty energy industry cash.

There is no quick fix for U.S. energy policy. Today, domestic oil production is higher than any time in almost a decade, yet American consumers are still getting robbed at the gas pump. Until the Obama administration gets serious about alternatives, this robbery, and the lies from the Republicans, will continue to happen on a regular basis.

May 20 2011

17:16

On Oil Drilling, Which Obama Do We Trust?

Mainstream media has been covering oil in some form or fashion nonstop for weeks. Stories abound over high gasoline prices, oil industry subsidies, and oil drilling. And in spite of all of this coverage and numerous speeches, it is unclear where the Obama Administration stands on the issues.

While on the campaign trail in 2008, Obama told us that he would continue the ban that was in place on new offshore drilling projects in American waters. A year after taking office, he reversed this position and opened up 500,000 square miles of water for oil drilling. Less than a month after opening up these waters, disaster struck as BP’s Deepwater Horizon oil rig exploded and sank, causing millions of gallons of oil to leak into the Gulf of Mexico. After this tragedy, the Obama Administration put a moratorium in place to stop new leases on offshore drilling, going back to his original campaign promise.

Unfortunately, just a year later, the administration has apparently forgotten the lessons we learned after BP’s blowout, as this week they announced that they are not only in favor of opening up more waters for drilling, but are also planning on opening up areas of Alaska for the oil companies to plunder.

So I ask – which Obama do we trust? Campaign Obama? Post-election Obama? Post-BP Obama? Or present-day Obama? <!--break-->
It is incredibly naïve to take any politician for their word during a campaign, and I’ll even go as far as to admit that viewing the issues from outside of Washington may not grant the full picture of the issue, but all of the available research tells us that even if we were to open up every available inch of land for oil drilling, it would do nothing to get us off our foreign oil addiction, or reduce the prices we’re paying at the pump.

The oil-loving Bush Administration actually did a wonderful job proving how little the impact would be if we opened up the Alaskan National Wildlife Refuge (ANWR) for oil drilling. According to their own estimates, the oil would take about a decade or more before it even reached the market, and at that point might bring the price of oil down by about 50 cents per barrel at its peak. That translates to a reduction of about 1 to 3 cents less per gallon of gasoline at the pump. They estimated that there are roughly 10 billion barrels of oil in the wildlife refuge, and since the US consumes 6.6 billion barrels a year, despoiling that wild public treasure would only supply enough oil to completely fuel the United States (no imports or other sources) for about a year and a half. After that, the well is completely dry.

The Gulf of Mexico oil reserves don’t offer much to get excited about either. According to the U.S. Minerals Management Service, the best estimates say that there could be as much as 20 billion barrels of oil in the Gulf (again, at best.) This means that the Gulf could fully supply America for maybe 3 years, if the estimates are correct.

The facts tell it all – the only group that will benefit from increased oil drilling in America is the oil industry. Those of us who aren’t a part of that club will see absolutely no benefit from increased domestic drilling.

But while Americans have been rightly focused on the fact that oil companies are reaping billions of dollars in subsidies from the federal government every year, they’ve turned a deaf ear to the issue of drilling. The U.S. Senate narrowly defeated a measure this week to expand drilling, but with our president pushing for more, and a Republican-controlled Congress pushing even harder, the very leaders who should be working to kick America's dirty and deadly oil habit are instead solidifying our addiction.

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