Time to Get Tough (3 page)

The fact is, you're not going to see real growth or create real jobs until we get these exorbitant energy costs under control. Someone needs to tell this president that business owners are not the enemy; they're the people who create jobs. Government can't create jobs. All it can do is put more people on the taxpayer's dime. All it can do is sap our nation's wealth.

The real way to help the 14.4 million unemployed Americans get their jobs back is not through “stimulus spending” that only has you, the taxpayer, cutting the check for yet more government employees. The real way is limiting taxes, slashing crippling and unnecessary regulations, and keeping commodity and fuel costs low.

If our “community organizer in chief” would take the time to study the marketplace, he would know that over the past year, things like fruit, pasta, coffee, bacon, and lots of other foods have registered price spikes as high as 40 percent, and there's no end in sight—in large part because of the price of oil, which has spiked transportation and fertilizer costs.
⁶
Until we get this country's lifeblood—oil—back down to reasonable rates, America's economy will continue to slump, jobs won't get created, and American consumers will face ever-rising prices.

We can talk all day about windmills, nuclear power, and solar, geothermal, and other alternative fuels. I'm all for developing alternatives to oil, but that's for the long term. The fact is, right now and for the foreseeable
future, the planet runs on oil—and that means we need to get the price of a barrel of oil down—way down, maybe even to $20 a barrel—and boy would our economy rock.

Does Obama do that? No. He goes around the country lecturing everyone that they need to buy hybrid vehicles, before hopping in his carbon-spewing presidential limousine and Air Force One. If he's really concerned about carbon emissions and air pollution, then maybe he should have grounded his wife before she jetted off with forty of her “closest friends” on a lavish vacation to Spain on the taxpayers' dime. I've got a private jet and love taking my wife and kids on expensive trips too, but there are two differences: I pay for it myself, and I don't go around waving my finger in people's faces lecturing them on the evils of travel and restricting their economic freedoms.

Obama promised he was going to create millions of so-called “green collar” jobs. He used that promise to justify his massive government giveaway of billions and billions of taxpayers' dollars to green energy companies. We're now seeing the results of Obama's promise and big government scheme. Solyndra, a U.S. solar panel company, turned out to be a total bust. They were selling $6 solar panels for $3. It doesn't take a genius to realize that's a loser of a business model. But Solyndra's owner, billionaire George Kaiser, had an inside connection with Obama: Kaiser was a big Obama donor and one of the president's campaign fundraiser “bundlers.” So the Obama administration fast-tracked a $535 million federally guaranteed loan. Obama believed so much in Kaiser and Solyndra that he made a big public relations event at Solyndra to deliver a speech singing the praises of Solyndra, green jobs, and justifying why taxpayers should foot the bill to
stimulate green companies. Predictably, the company went bankrupt, its 1,100 workers lost their jobs, and the American taxpayer got the shaft, to the tune of over half a billion dollars.

Obama has played off the Solyndra scandal, saying he has no regrets and that the company “went through the regular review process.”
⁷
However, in the wake of FBI investigations, the truth is now leaking out. According to the
Washington Post
, emails have now been released revealing that “evidence is mounting that there was something irregular about the way the Solyndra deal got greenlighted.”
⁸
I predict that there will be many more “Solyndra-style” revelations in the months to come. But Solyndra just shows you that this bunch is engaged in the very crony capitalism and insider deal-cutting that they are always accusing others of. Worse, it shows that the millions of green jobs Obama promised were completely bogus.

But even more shocking than the hypocrisy of it all is the total cluelessness it reveals. At one of the president's speaking events, a man told Obama that he and his wife need a bigger vehicle because they have eight kids. So what did Obama do? He told the guy, “Buy a hybrid van.” Just one problem:
they don't exist in America
. This president cannot even speak intelligently without a teleprompter. It's embarrassing and sad!

When he's not hectoring people about hybrids, he's appointing his Attorney General Eric Holder to conduct criminal investigations of gas stations engaging in “price gouging.” This is a silly attempt to scapegoat and deflect attention away from how ineffective and weak he is on energy policy. As anyone with a brain knows, the reason gas prices are through the roof is because OPEC controls supply and therefore massively inflates crude oil prices.
⁹

America doesn't have time for games. This country is in huge trouble. It's time to get serious and look at the facts. Currently, we're paying over $85 a barrel for oil. The United States uses about 7 billion barrels of oil a year. Do the math. We're singlehandedly transferring hundreds of billions of dollars a year to OPEC countries that hate our guts. And again, we're giving all this money to governments who seethe with anti-American hatred. It's stupid policy.

With proper leadership, we can get that price down to $40–$50 a barrel, if not the $20 that I have previously suggested. But to get there we need a president who will get tough with the real price gougers—not your local gas station, but the illegal cartel that's holding American wealth hostage, OPEC. OPEC stands for the Organization of the Petroleum Exporting Countries. It was created at the Baghdad Conference in September 1960 by our good buddies Iran, Venezuela, Saudi Arabia, Iraq, and Kuwait. Since then OPEC has added as members Angola, Ecuador, Qatar, Algeria, the United Arab Emirates, Nigeria, and our dear friend Libya. So here you have twelve men (in this case they're all men) sitting around a table determining and fixing the price of oil. Now, if you have a store and I have a store and we collude to set prices, we go to jail. But that's what these guys do, and no one lifts a finger. And the worst part of it is that these twelve OPEC countries control 80 percent of the world's accessible oil.
¹⁰

Let your eyes dart back up to that list of OPEC's founding members. First up, Iran. Iranian President Mahmoud Ahmadinejad has called for wiping our close ally Israel off the map. He said that the September 11
terrorist attacks on New York were a plot by the United States government. He believes the Holocaust is a “myth.” His regime is developing nuclear weapons in violation of the Nuclear Non-Proliferation Treaty. Next, Hugo Chavez's Venezuela. During one of his rambling United Nations speeches, Chavez called President George W. Bush “the devil.” His mouthpiece in Venezuela, ViVe TV, issued a press release in January 2010, saying the 200,000 innocent victims of the awful Haiti earthquake were really killed by an American “earthquake weapon.”
¹¹
Then look at Saudi Arabia. It is the world's biggest funder of terrorism.
¹²
Saudi Arabia funnels our petro dollars—our very own money—to fund the terrorists that seek to destroy our people, while the Saudis rely on us to protect them! Then there is Kuwait, which would not even exist had we and our allies not fought the First Gulf War against Saddam's aggression. And of course we have Iraq, whose freedom we've paid for to the tune of more than a trillion dollars and more than 4,000 dead servicemen and women. These countries do us no favors. Through OPEC they squeeze us for every penny they can get out of us.

Two years ago, Amy Myers Jaffe, an energy expert from the James A. Baker III Institute for Public Policy at Rice University, did a study to determine the real product cost of a barrel of oil. The price of a barrel of oil back then was $ 60. Jaffe found that the actual cost to produce a barrel of oil then was $15, exactly a quarter of the actual market price.
¹³
That means you're looking at a 400 percent markup on pricing before the oil even gets to the refinery to be turned into gas. Again, if you or I did this, we would be thrown in jail, because it's illegal to collude and fix prices. But these petro thugs do this year in and year out and laugh all the way to the bank. They
claim they're not restricting oil production to jack up the prices, but that's a lie. In 1973, OPEC produced 30 million barrels a day. Guess how much they produced in 2011? That's right, the same amount. Production hasn't moved an inch. The reason for this is
not
because OPEC countries have reached peak oil output. After all, as Robert Zubin points out, as recently as April 2011, the Saudis announced they were going to cut production by 800,000 barrels a day, so they're nowhere near running at full capacity.
¹⁴
Instead, OPEC is squeezing production so oil prices skyrocket and America pays.

The OPEC countries wouldn't even exist if it weren't for us—it's our money that makes them rich and our troops that have made Iraq free and kept Kuwait, Qatar, and Saudi Arabia from being gobbled up by Saddam Hussein (or now, potentially, by Iran). A smart negotiator would use the leverage of our dollars, our laws, and our armed forces to get a better deal from OPEC. It's time to get tough. And smart!

We can start by suing OPEC for violating antitrust laws.

Currently, bringing a lawsuit against OPEC is difficult. It's been made even more complicated by a 2002 federal court, and subsequent appeals courts, ruling that “under the current state of our federal laws the individual member states of OPEC are afforded immunity from suit brought for damage caused by their commercial activities when they act through OPEC.”
¹⁵
The way to fix this is to make sure that Congress passes and the president signs the “No Oil Producing and Exporting Cartels Act” (NOPEC) (S.394), which will amend the Sherman Antitrust Act and make
it illegal for any foreign governments to act collectively to limit production or set prices. If we get it passed, the bill would clear the way for the United States to sue member nations of OPEC for price-fixing and anti-competitive behavior.

One of the smart people in this debate is Iowa Republican Senator Chuck Grassley, a co-sponsor of the bill. “It's time to get it passed,” says Grassley. “OPEC needs to know we are committed to stopping anti-competitive behavior.”

Here's the good news: since 2000, this bill has passed the Senate Judiciary Committee four times with bipartisan support, and in May 2008, the NOPEC bill passed in the House when Democrats were in control. Now the bad news: President George W. Bush got spooked and threatened to veto the bill because he was afraid that, with the wars in Iraq and Afghanistan raging, NOPEC might spark “retaliatory action.” Bush's fear was misguided. First of all, these oil shakedown artists need and want our money. What are they going to do? Fold their arms, throw a temper tantrum, and refuse to sell us their oil and be out billions and billions of dollars? Give me a break. And two, they
already
engage in “retaliatory action”: it's called a 104 percent spike in the price of gas since Obama took office, and that's with him going around practically kissing their feet.

Thomas W. Evans was an adviser to Presidents George H. W. Bush and Ronald Reagan. Evans says that when OPEC or its member nations realize the likelihood of the huge damages they would face and how their illegal actions would be curtailed, they would be forced to seek a settlement on production goals that would put prices in much closer alignment with actual costs. The net effect, says Evans, would be price reductions
for heating fuel and gas at the pump that would be so large they might exceed the $168 billion the government spent on the 2008 federal stimulus package. As for concern over any potential fallout, he says what I say: getting tough is getting smart. Suing OPEC “would undoubtedly anger political leaders in the Middle East,” writes Evans. “But how stable is the Middle East right now? And isn't starting a lawsuit better than starting a war?”
¹⁶

Imagine how much money the average American would save if we busted the OPEC cartel. Imagine how much stronger economic shape we would be in if we made the Iraqi government agree to a cost-sharing plan that paid us back the $1.5 trillion we've dropped on liberating Iraq so it could have a democratic government. Just those two acts of leadership alone would represent a huge leap forward for our country. And by the way, it would also make us respected again in the world. It's sad—truly sad and disgraceful—the way Obama has allowed America to be abused and kicked around. All we have to do is be smart and show some backbone to begin setting things right.

So number one, we take the oil through the cost-sharing plans that even the GAO says are smart and feasible. Two, we hit OPEC in the wallet and rein them in by signing into law the bipartisan NOPEC law. And the third thing we need to do is to take advantage of one of our country's chief assets—natural gas. We are the “Saudi Arabia” of natural gas, but we don't use it. Abu Dhabi recently had all of their transportation converted to natural gas so they can sell their expensive oil to us.
¹⁷
Even they recognize
how efficient natural gas is. It's cleaner, cheaper, and better. So why aren't we using it to our advantage?

Did you know that with the natural gas reserves we have in the United States we could power America's energy needs for the next 110 years? Those aren't my estimations, that's what the United States Energy Department's Energy Information Administration says. In fact, one of the larger mother lodes of natural gas, the Marcellus Shale, could produce the energy equivalent of 87 billion barrels of oil.
¹⁸
Some critics believe those numbers might be inflated. Fine. Let's say the real number is fifty-five years of energy, or that we only get 43 billion barrels' worth of energy. So what? That buys us more time to innovate and develop newer, more efficient, cleaner, and cheaper forms of energy.