What the (Bleep) Just Happened? (27 page)

Obama fully intended to “bankrupt” the coal industry in order to make way for the Left’s “green energy” agenda. Largely born out of the kooks’ obsession with the man-made global warming scheme, “green energy” was an ideal vehicle for redistributionism. For followers of the Church of Gore, man-made global warming, later rebranded as global climate change, was built on the idea that our carbon emissions were being trapped in the atmosphere (possibly stuck in a gas bubble resulting from one of Al’s late-night Taco Bell runs), causing the earth’s temperature to rise rapidly and thus endangering everything from Florida’s beaches to the Arctic polar bears. If humanity were to be protected from this scourge of industry, industry must fall on its knees, beg for forgiveness, agree to a slew of new government mandates, and, oh yeah, fork over gazillions of dollars more as part of its penance.

By 2010, however, the fall of the Church of Gore began. The revelation of the Climategate e-mails and other evidence that global warming alarmist scientists conspired to manipulate data, suppress conflicting information, extrapolate from weak or unsupported evidence (such as the UN’s Intergovernmental Panel on Climate Change’s claim that the Himalayan Glacier would melt in 2035, which was based on one group’s claim that it would melt in 2350) severely damaged the credibility of the man-made warming scaremongers. Serious questions were raised about whether they were willing to abuse science to serve the greater redistributionist goal. As a result, there has been ever-growing pressure on the redistributionists to force policy changes in energy since the “consensus” they had built around scienitifically dubious “evidence” is falling apart.

Even with the aggressive push from the Gore cultists, green technology had been relatively slow to develop, in large part because there wasn’t a market for it. Traditional fossil fuels dominate, providing us with 98 percent of our energy, and without a massive government push to destroy the traditional energy sector, it would take far too long for “green” to gain traction. They couldn’t wait for free enterprise to sort it out. What couldn’t compete in the marketplace needed—and got—a huge helping hand from Big Daddy.

Cap and trade came first. The leftists sought to create a new cap on emissions and then enforce it with a series of hugely expensive mandates. The costs, of course, would get passed on to the consumer, hence those “necessarily skyrocketing” electricity prices. Because everything requires energy—from development to production to transport—cap and trade would have been tantamount to the largest tax increase in the history of the world. And by its very nature, it would have been highly regressive, hitting the poor and middle-income households harder, since they spend more of their income directly on energy, such as gas to get to work or home heating. The point was to begin to destroy the coal industry to make way for the leftists’ beloved “green energy” while giving the federal government an entirely new—and massive—revenue source.

The legislation passed the Democrat-controlled House but died in the Senate, despite the Democrats’ filibuster-proof majority, because a number of Democrats from coal-producing states such as West Virginia and Pennsylvania didn’t take kindly to Obama’s attempt to kill their leading industry.

With cap and trade dead legislatively, Obama and the kooks began making end runs around Congress to achieve their energy objectives without having to deal with Congress. Enter the EPA.

Obama empowered his EPA administrator, Lisa Jackson, to use the Clean Air Act as a rationale to impose new regulations like fairy dust (which will be regulated next) on everything from industrial boilers to farm dust, cement, greenhouse gases, and mountaintop coal removal, which a federal judge overturned. Most of these regulations have already led to plant closures, massive job losses, and higher prices for consumers. In late November 2011, Jackson admitted that objective in an interview with
Energy NOW News
, in which she was asked about the coal-fired plant closures as a result of the EPA regulatory spree. “What EPA’s role is to do is to
level the playing field
so that pollution costs are not exported to the population but rather companies have to look at the pollution potential of any fuel or any process or any plant or any utility when they’re making their investment decisions.” At the core of any centrally planned economy is the state’s forcible leveling of the playing field. Burden some industries with so many costs that they can no longer operate and replace them with state-sanctioned ones. An added benefit: the new rules will bring in tons of cash from the fines levied on companies that cannot comply with them.

Under the cumulative weight of all of the new Obama EPA regulations, the National Economic Research Associates—using the federal government’s own data—projects that they would cost America over 180,000 jobs per year between 2013 and 2020.

Amid falling poll numbers and a bleak economy, Obama decided to pull back on one major new proposed regulation—but only because he didn’t want to take on the political fight at that moment. In September 2011, he ordered EPA administrator Jackson to withdraw the new proposed “ozone rule,” which, according to Republican senator Jim Inhofe, would have destroyed seven million jobs. Jackson was reportedly so furious at Obama’s request that she considered resigning. Sadly, she stayed to hyper-regulate another day.

Obama has been methodically destroying the traditional energy industry as he goes, in order to smash the existing structure and replace it with the kooks’ “green dream” (in which Gore appears on a polar bear, wearing only his Florida recount beard). As Senator James Inhofe put it, “All of this killing of our energy supply is not by accident. It’s on purpose.”

At the same time, Obama launched a broadside against another key part of the U.S. energy sector: the oil and natural gas industry. After the cap and trade bill failed, Obama stated a willingness to approve some limited oil exploration. In March 2010, he announced some half-measures that would allow drilling along the Atlantic coastline, the eastern Gulf of Mexico, and the north coast of Alaska, but he continued to prohibit exploration in the Arctic National Wildlife Refuge (ANWR) and Bristol Bay. He also indicated that he’d allow large tracts in the Chukchi Sea and Beaufort Sea in the Arctic Ocean north of Alaska—nearly 130 million acres—to be eligible for exploration and drilling after extensive studies, which meant they’d be ready for exploration on the twelfth of Never.

Just weeks later, on April 20, 2010, a wellhead blowout occurred on the Deepwater Horizon oil rig, which was operating on the British Petroleum Macondo Prospect in the Gulf of Mexico. The initial explosion killed eleven workers and injured seventeen others, and millions of barrels of crude oil began flowing into the waters. It became the largest accidental oceanic spill in history. And it also became a perfect metaphor for the Obama presidency: an uncontrollable poison spewing into a pristine environment unless mankind could stop it. Meanwhile, as the cloud of petroleum endangered new species, our fearless leader was focused on another animal: a Beatle, in fact. Obama took an entire evening in June 2010 to honor Sir Paul McCartney with the Gershwin Prize while the pop icon serenaded Obama in the White House as the Gulf Coast drowned in black death.

Obama, the supposed Competence Man, was caught flat-footed by the disaster. The administration claimed to be in charge while also insisting that BP take the lead. It was slow to move federal resources such as oil-absorbing booms and sand berms to deal with the leak. It was also slow to coordinate efforts among the impacted states; other Big Oil companies, who had offered equipment, manpower, and expertise; and foreign countries, such as Saudi Arabia, which had also offered technology and information it had developed as a result of spills in that other gulf. Ultimately, some foreign nations, such as Norway, the Netherlands, and Canada, did send ships with skimming and other cleanup capabilities. Meanwhile, Obama blew a gasket of frustration because his usual management style of ordering everyone around—Congress, BP, the media, the American people—wasn’t working this time. “Plug the damn hole!” he snapped.

The BP oil leak did give Obama the ideal pretext to halt permits for offshore drilling. The Interior Department’s permitting review recommended a moratorium and implied that that recommendation had been peer-reviewed by a panel of drilling experts it had consulted during the review. Those experts then went public, saying that in fact they had neither been consulted on the moratorium recommendation nor agreed to it. Interior secretary Ken Salazar went ahead with the moratorium order covering all drilling in depths of 500 feet or more, leading some deepwater drilling companies to file lawsuits against the government.

On June 22, U.S. District Judge Martin Feldman issued an injunction and an order that Interior
not
enforce the moratorium because he found it, in the standard legal term, “arbitrary and capricious.” The department stopped enforcement, until Salazar said publicly that he intended to reimpose the moratorium, and all drilling permits were again halted. Interior appealed Feldman’s injunction to the United States Court of Appeals for the Fifth Circuit and in July lost that appeal.

Four days later, the department issued a new moratorium nearly identical to the first. In October, Interior ostensibly lifted the moratorium but no new deepwater drilling permits were issued for months, and subsequent permits were slow-walked. That same month, an Interior Department inspector general’s report showed that the original review had been manipulated to mislead the public. In February 2011, a furious Judge Feldman found Obama’s Interior Department in civil contempt for violating his original order dissolving the administration’s offshore drilling moratorium—and the mainstream media all but ignored the story. They also largely ignored the fact that many Gulf-state Democrats like Louisiana senator Mary Landrieu opposed the moratorium. In Louisiana alone, more than 320,000 folks depend on the oil and gas industry for work. At least ten oil rigs pulled up stakes from the Gulf and moved to more lucrative areas off the coasts of South America and Africa, costing even more jobs. In 2011, the House Committee on Oversight and Government Reform reported that Obama’s systematic blocking of domestic energy production in the Gulf has led to the loss of over $9 billion in capital investment in 2011 alone and tens of thousands of jobs.

In the spring of 2011, Obama’s EPA went a step further and forced Shell Oil to shut down its massive exploration project in the Arctic Ocean. Shell had spent five years and $4 billion ($2.2 billion in leases alone to the federal government) to develop the area for domestic drilling. According to the U.S. Geological Survey, there are 27 billion barrels of oil in the Arctic Ocean, which Obama’s EPA put off-limits. I hope the Russians enjoy!

In late 2009 the Export-Import Bank approved a $2 billion loan to Brazil’s state-owned oil company, Petrobras, to finance exploration of a huge offshore discovery near Rio de Janeiro. One of Petrobras’s key investors? Kook billionaire and Obama supporter George Soros. It turns out that Obama loves oil exploration and drilling in other countries, just not here at home, where it could create American jobs and lower gas prices.

The capstone to Obama’s assault on the oil and gas industry came in late 2011 when his administration refused to grant permission to TransCanada to build the Keystone XL pipeline, which would have put tens of thousands of Americans to work immediately and facilitated the domestic movement of crude from a central storage hub in Oklahoma to large refineries on the Gulf Coast. Once Obama’s decision was made public, the company fled into the arms of the Chinese, to whom they will sell the oil and who will export it in tankers. Without the pipeline extension, our own oil imports will necessarily increase, which means more price volatility, more dependency, more tankers coming into U.S. waters, and the likelihood of a greater environmental impact because pipelines are the most efficient and cleanest way to transport big volumes of oil.

Big Oil is, of course, one of the ol’ reliable bogeymen for the leftists, who, when they’re not blocking exploration, drilling, and pipelines, seek to stick it to the major oil companies through higher taxes while undermining their entire industry. The reality is that the oil and gas industry paid more taxes in 2010 than any other industry. It pays an effective tax rate of 41.1 percent, compared with 26.5 percent for the rest of the Standard & Poor’s Industrials. Furthermore, the “subsidies for Big Oil” about which the Left is always screaming aren’t subsidies at all. Some of the things the Left incorrectly terms “subsidies” for Big Oil include the ability to recover some exploration and manufacturing costs; Big Oil can recoup some of those costs but at a lower rate than most other eligible companies. There are other deductions from which Big Oil is blocked altogether, such as the percentage depletion deduction.

The federal government does, in fact, issue actual subsidies to things like ethanol, solar and wind energy projects (hello, Solyndra), and other wasteful items and programs as a way to take care of political constituencies and for ideological reasons. These subsidies generally support industries that probably could not survive in the open market. They should be eliminated. But to suggest that Big Oil is somehow receiving special treatment for using tax credits available to them—the way every other industry does—is dishonest.

For the leftists, their adventures in remaking the energy sector are driven by two main goals. The first is to prop up “alternative energies” out of a desire to move the country toward “clean energy” and away from foreign dependency. These good intentions are shared by many conservatives and others, but the leftists’ full-frontal assault on our domestic energy producers as well as their economic engineering in energy warps the noble mission of getting us to cleaner domestic production.