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Pinning Pelosi

I received an interesting e-mail yesterday:

Nancy Pelosi, Speaker of the House and Author of “Know Your Power: A Message to America’s Daughters” will answer questions in a live discussion on washingtonpost.com today (Wednesday, Aug. 6 at 3 pm ET).

Pelosi will discuss the current political scene heading into the conventions, the message of her new book and other questions submitted by readers.

To submit questions and participate in the live discussion click here: http://www.washingtonpost.com/wp-dyn/content/discussion/2008/08/01/DI2008080102174.html

This seemed to me to be an ideal opportunity to pin her down on two issues that she is clearly passionate about, but seem to me to be diametrically opposed: Tapping the Strategic Petroleum Reserve (SPR) and reducing carbon emissions. So, I submitted the following question, several hours prior to the chat:

Dear Speaker Pelosi,

Perhaps you could clarify an issue that is baffling to me. On the one hand, you have spoken passionately for the need to combat global warming by reducing our carbon emissions. This is clearly a priority for you, as well as for large segments of the Democratic Party. On the other hand, you have also come out strongly in favor of tapping oil from our Strategic Petroleum Reserve in order to bring oil prices down. Given that high prices are causing the public to abandon SUVs and to embrace fuel efficiency and mass transit – exactly the sorts of things that need to happen if we are to reduce carbon emissions – how is your position on the SPR not completely inconsistent with your position on global warming? If in fact you push through your proposal on the SPR, won’t that lead to increased consumption and therefore increased carbon emissions?

Had I been a bit more long-winded, I would have pointed to reports that gasoline demand is in fact down this year, breaking a multi-year trend of increasing demand. Or I could have shown the many news stories showing record demand for Priuses while SUVs are not moving. The reason demand is down is clearly price-driven. Price is the clearest handle we have on moderating demand.

Unfortunately, Pelosi (or the person screening the questions) decided not to answer my question. Instead, they answered a question in which she could once more push for tapping the SPR!

Marietta, Georgia: Dear Madam Speaker,

Although this forum is primarily focused on your book, I cannot help but bring up an issue that is affecting each and every American. Why have the American people not seen energy legislation that lowers the price of gas?

Thank you

Nancy Pelosi: Now let’s pivot from book questions to a topic many of you have raised: the high price of gasoline at the pump and what we can do about it.

Every American family is affected by the high price of oil and gas. It is our responsibility in Congress to protect the consumer and increase the domestic supply of energy. For the past 18 months, the Democrats in Congress have set forth an energy agenda. Some has been passed into law – and some has been blocked by the Republicans.

House Democrats have put forward 13 major proposals that would increase supply, reduce prices, protect consumers and transition America to a clean, renewable energy-independent future. Each time a majority of House Republicans have voted against these proposals.

Let me be very clear: drilling for oil in protected areas offshore will not bring down the price at the pump for 10 years – and then only 2 cents. To say otherwise is a hoax on the American people.

Here’s what we can do:

1. Free Our Oil

We can have immediate price relief at the pump. Freeing our oil from the Strategic Petroleum Reserve will bring down the price of oil in 10 days. President Bush refuses to take this step for immediate relief.

10 years or 10 days – the choice is clear.

2. Use It or Lose It

Democrats passed the Drill Bill which says to Big Oil “Use it or lose it!” – drill in the 68 million acres in the lower 48 states or let someone else drill there. Also, “use it or lose it in Alaska. All of these areas have permits for drilling – and will produce oil sooner than drilling in protected areas offshore.

3. End Excessive Speculation Which Raises the Price of Oil

Democrats were part of a strong bipartisan vote was taken in the House but GOP leaders twisted arms to block passage.

4. Repeal the subsidies for Big Oil

With Big Oil making record profits, they do not need American taxpayers funding their drilling.

Instead we can invest in research, renewable energy, and tax credits for wind, solar and other renewables. This passed the House but failed in the Senate by one vote – John McCain was absent that day but said he would have voted no.

5. Increase Our Energy Supply With Increased Use of Natural Gas – a cleaner energy source.

There is immediate relief for the consumer – if only President Bush would free our oil.

I must say that Number 5 is a surprise, and something I have long advocated. Instead of recycling our natural gas into ethanol, it would be much more efficient to use it directly as fuel. As I have pointed out before, Brazil – the poster child for ethanol production – also has 8 times the number of natural gas vehicles on the road as we do in the U.S. They don’t waste their natural gas separating ethanol from water. Besides Brazil – Argentina, Pakistan, Italy, and India all have larger natural gas fleets than does the U.S. So for those who suggest that we don’t have the infrastructure in place to manage this, maybe we can learn from India and Pakistan. So I agree with Pelosi on this point: As our supply of oil depletes, we can moderate the decline with natural gas.

Number 1 on Pelosi’s list is the very contradiction I asked about, Number 2 promotes a myth (there already is a ‘use it or lose it’ provision in the law) and is nothing more than pandering, Number 3 may have some merit, but is again in contrast to her position on global warming (higher prices equal lower carbon emissions), and Number 4 says that oil companies should not be entitled to the same sorts of tax deductions afforded every other industry. I will let you all in on a dirty little secret: Big Oil also deducts the salaries of their employees from their gross receipts, just like every other business. Maybe that ‘subsidy’ should be eliminated. Maybe their deductions for capital spending should be disallowed. More subsidies. But I digress.

Can anyone explain to me why championing action on global warming while also championing tapping the SPR is not blatantly contradictory? Anyone? Or why nobody in the Democratic Party seems to have the guts to speak out on this contradiction? Instead, Barack Obama – long opposed to tapping the SPR – has now fallen into line and is calling for the same.

Actually, I think I know the answer to the contradiction. Proponents of tapping the SPR think that alternative fuels are going to rapidly scale up, displace petroleum with cheap ethanol, and the consumer won’t have to suffer in order to bring fossil fuel consumption down. To that, I would point out that the Energy Information Administration – the source of Pelosi’s claim that drilling in the OCS would only bring prices down by 2 cents a gallon – testified last year that they don’t foresee that cellulosic ethanol is going to scale up to even a billion gallons by 2030.

The EIA also predicts that fossil fuels will continue to be the dominant source of our energy supply for decades to come. So, the very agency Pelosi references in her argument for tapping the SPR is telling us in no uncertain terms that alternative fuels aren’t going to ride to the rescue. With that in mind, I believe it is impossible to reconcile a position of tapping the SPR with a position that reducing our carbon emissions is a high priority. It’s like saying “I propose that the nation needs to go on a diet. And by the way, I also propose that we increase the supply of donuts to make them more affordable.”

I just wish a politician would have the guts to step forward and address this contradiction.

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August 7, 2008 - Posted by | energy policy, global warming, Nancy Pelosi, politics, SPR

17 Comments

  1. The Democrats have a heck of a problem on their hands in terms of working their way out of this “SPR release okay / offshore drilling not okay” position.

    Almost every American now has the sense that we have a problem looming with energy in the long term, and they can pretty much all put two and two together and figure out what’s a short term solution and what’s not.

    I’m surprised Obama isn’t backpedaling faster.

    Comment by mh497 | August 7, 2008

  2. The Democrats need to stiff-arm the NGOs and look to the greater good. The real problem is that the NGOs don’t have credible positions. Until that changes the Democrats are trapped. They know the NGOs are right about the environment, but they also have to at least suspect the policy prescriptions are too extreme and ultimately unworkable. Once again I point to Germany as the example of where we’ll end up if we follow that path.

    Comment by Anonymous | August 7, 2008

  3. I don,t liked to gamble, (never been to Las Vegas!) but go figure! , I will raise millions drilling a well for the production of oil & gas.

    The way the current events are shaping up in the Middle East (Iran Nuclear Bomb wannbe to join the Nuclear Club and wipe the nation of Israel off the face of Earth! killing millions in the attacks, I predict that Israel
    will launch an attack against Iran soom with the possiblility of the UNITED STATES OF AMERICAN , THE MOST POWERFULE ARMED NATION IN THE WORLD TODAY!, JOINING IN AND IN LESS THAN 48 HOURS WIPEING OUT OR DAMAGEING IRAN'S NUCLEAR MAKING FACILITES, AIR FORCE , NAVY ECT. WITH LOW LOST OF LIFE ON BOTH SIDES!

    THE PRICE OF OIL WILL JUMP OVER NIGHT TO 2
    $200 – $4OO OVERNIGHT!

    MORAL OF THE STORY! THE UNITED STATES OF AMERICAN HAS A INSURANCE POLOICY!

    THE SPR! 1,000,000,000 BILLIONS BARRELS OF OIL SAFETY IN STORAGE NOW AND READY TO USE IN A EMERENGCY!

    THIS WILL BE A EMERMERCY!!!!!!

    DO NOT LET PELOSIS (THE WANNBE QUEEN!) WHO IS SUPPOSE TO REPRESENTS US (WE THE PEOPLE" ) GET AWAY WITH STUFF!!!!!!!!!!!!!

    SOMEONE NEEDS TO ASK HER HIGHNESS THIS SIMPLE QUESTION (REPORTER, ECT.) ON A SIMPLE QUICK FIX PROBLEMS.

    Any takers!

    HAVE A NICE & PROSPERS DAY!!!!!!!!!!!

    Comment by Anonymous | August 7, 2008

  4. You know, another argument which I only recently understood is that highway construiction is heavily subsidized by general fund taxpayers. In other words, you pay for roads when you pay income, property and sales taxes. Roads are a socialist-communistic heaven.
    You are taxed for the common good, for roads which are owned in common. Communism!
    I get this from the Texas State Dep’t of Transportation, which has put out reports stating that gasoline taxes can pay for as little of 16 cents of the dollar of road costs.
    Let’s go to free markets. A toll road on every corner is impractical, so we need to raise gasoline taxes by $3 a gallon.
    Ask McCain if he supports the current communism method of road-building, or one based on free markets and price mechanisms.

    Comment by benny "peak demand" cole | August 7, 2008

  5. Robert — you are (rightly) amazed by Nancy Pelosi's inconsistency. But I in turn find myself amazed by your amazement.

    Nancy Pelosi is a politician — not a very good one, to be sure, but a politician through & through. 5 decades of politicians like Mrs. Pelosi have created an unsustainable mess of our energy future — just as the same politicians have created an unsustainable mess of Social Security, for example.

    The problem is politicians!

    And yet you expect San Fran Nan suddenly to find common sense, if not the wisdom of Solomon? Why do you expect something that is so contrary to your own experience, Robert?

    Before we can fix a problem, we have to be willing to identify the real cause. There is absolutely no doubt about why we are facing such a precarious energy future. You know that, Robert. Why not admit it?

    Comment by Kinuachdrach | August 7, 2008

  6. Where is Robert R’s energy plan? Is there a link to it I have missed? Is this a joke I’m outside of? Thanks.

    Comment by evan | August 7, 2008

  7. Kinuachdrach: Are you a commie? Or do you agree with me, that users should pay for roads, either though tolls or gasoline taxes?

    Comment by benny "peak demand" cole | August 7, 2008

  8. Where is Robert R’s energy plan?

    Robert Rapier’s Energy Plan: The High Points

    RR

    Comment by Robert Rapier | August 7, 2008

  9. The problem is politicians!
    Hear-hear!

    Now if we can just tap the hot air coming out of Washington DC, we’d have a near-endless supply of renewable energy.

    You know that, Robert. Why not admit it?
    That’s the difference between you, Kin, and RR: he’s looking for a practical solution. You like to rail against the unfairness of it all (sometimes justifiably) with no regard for arriving at a practical solution.

    So let me ask you: How do rid ourselves of these troublesome politicians? Or are they perhaps a reflection of our own immature desires? What are you going to replace them with? And don’t say a benevolent dictator, because power corrupts, as Mr. Mugabe insists on reminding us.

    1,000,000,000 BILLIONS BARRELS OF OIL SAFETY IN STORAGE NOW AND READY TO USE IN A EMERENGCY!
    Before you pull the trigger, Crazy Boy, you may want to consider the facts: The SPR can hold about 730 million bbl of oil, not the gazillion Brazilian that you seem to think.

    How much is 730 million bbl? That’s about a 35 day supply for America, or a 60 day supply for just replacing imported oil. Only, that won’t work either, because the maximum total withdrawal capability from the SPR is only 4.4 million barrels (700,000 m³) per day. What’s going to happen to oil prices when we try to replace the 12 million bpd we import with 4.4 million bpd? OUCH!

    Insurance policy? Yes. But nothing insolates one from pure idiotic ideas, does it?

    Comment by Optimist | August 7, 2008

  10. In 30 years I have yet to see a lease without an expiration clause (excepting of course productive leases). And they almost always have performance clauses designed to incentivize the lessee to drill as soon as possible.

    Where did this use it or lose it idea come from? Why would Pelosi imagine that a company would want to buy and maintain lots of leases it doesn’t intend to drill? Weird. The problem is not just politicians, but politicians with lazy intellects. Must be nice to be on Pelosi’s research staff. No work required. Let’s give them something to do.

    “Let me be very clear: drilling for oil in protected areas offshore will not bring down the price at the pump for 10 years – and then only 2 cents.”

    I’d like a follow up question, just to see what her research staff is capable of. In what month of 2018 will we hit the 2 cent target?

    Another Pelosi quirk. Even though global oil demand has grown by over 3 million barrels per day in the past 4 years, she apparently believes that’s not important – it’s Big Oil CEO’s to blame. Yet in tapping the SPR, she is giving a nod to supply and demand at work. Hmmm

    Comment by armchair261 | August 7, 2008

  11. Another Pelosi quirk. Even though global oil demand has grown by over 3 million barrels per day in the past 4 years, she apparently believes that’s not important – it’s Big Oil CEO’s to blame. Yet in tapping the SPR, she is giving a nod to supply and demand at work.

    Heh – I doubt she believes Big Oil’s really to blame. But they’re a convenient scapegoat, and the only ones within reach of the long arm of the (tax) law. Blaming them attempts to deflect criticism from herself and the other dems in congress that insist on toeing the line of enviro-activist groups. Tapping the SPR gives the appearance of helping the little guy while actually doing nothing that would piss off the enviro-lobby. Indeed, it might provide just enough relief to validate her positions before the election (after which, of course, the sky can fall).

    Comment by Anonymous | August 8, 2008

  12. I’m not surprised your question was not answered. The usual procedure now appears to be to carefully screen questions to eliminate anything embarrassing (just like the carefully staged presidential “debates”).

    But you are right, of course. The prices of fossil fuels must remain high to enforce change. BTW, gasoline here (Japan) is now in the neighborhood of 185 yen/liter. Americans bellyache about gas at half that price, but they have more room than other countries to use energy more efficiently.

    Comment by Rice Farmer | August 8, 2008

  13. Re: optimist said

    My Name is Leonard L. Huff III , as in reference to your comments,

    it is evident that don't know a drilling rig from a car!!!!!!!!!!

    Come on down here to South Texas and I will personally show you Three (3) drilling rigs running NOW! dailying drilling reports drilling totals running @ $300,000 per day (not including completion which can run up %50 of the drilling AFE (Authoritoyr FOR Drilling Budget)!

    Do your Git DAMM research before you lecture ME @ the EVIL OIL & GAS BUSIENESS!!!!!!!!!!!!!!!!!

    HAVE NICE & BROKE (LIBERAL DAY) DAY!!!!!!!!!!!!!!!!!!!!!!!

    Comment by Anonymous | August 8, 2008

  14. RE: Optimon!!!!!!!!!!!!!!!

    Whatever your real name is !!!!!!!!!!!!!!!!!!!!!!!!!

    You can label me a “crazy boy” if you can be a “MAN”!

    Come on down to south texas !!!!!!!!!!!!!!!!! were man are man and the women like it!!!!!!!!!!!!

    I didn’t think you do it!

    If you were answer this comments, I will give you my address and cell number on this site and COME ON DOWN!!!!

    YOUR MOVE!

    Have a Nice Day!!!

    Hope the Iran”s have plenty of rubber boats , because I have personally being through that narrow strait and it will be like shooting ducks in a ponds!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

    Comment by Anonymous | August 8, 2008

  15. Hacking away at politicians is very satisfying, but sadly simplistic. They are products of the system, and as long as they pander to multiple interest groups many will behave this way at the expense of the greater good. Our government in Australia has wedged itself between the economic impacts of climate action, and its agenda for social equity. Higher petrol prices vs the working family. But then would you live in a dictatorship?
    The so-called primitive Australian aborigines confronted the problem of how to live within limited resources, and the consequences were brutal for those who failed. I imagine many years of disasters until they finally adapted a culture to live within their means.
    We live at a time where we assume infinite plenty, and praise an increase of oil production by X percent forgetting this matches a depletion of reserves by the same amount.
    Pelosi demonstrates the human ability to hold two contradictory concepts at the same time. In this case, within a single sentence:
    reduce prices…and transition America to a clean, renewable energy-independent future.

    Robert, are you available for interview on a community radio science show? Please contact me at Rodtbox-3 “at” Yahoo.com.au.

    Rod

    Comment by Rodt | August 8, 2008

  16. Annonymous: Good comments, born of direct, dirty, practical observation. As a fellow utilities operator, I appreciate your practical service to society. You shouldn’t belittle your own opinions by bringing corporate derived propogandist bipartisan terms (the L word) from pre-destined talk radio media into a realistic and practical discussion. Think for yourself and just listen to some damn music station that doesn’t encourage blindfolded political extremism and knoxville chruch shootings http://en.wikipedia.org/wiki/2008_Knoxville_Unitarian_Universalist_church_shooting I’d like to see an oil rig, the closest I’ve come to an oil rig is through Joe Dirt. Is your rig off shore? You should send pictures.

    Comment by evan | August 8, 2008

  17. So Leonard,
    Is it considered manly in South TX to use CAPITALS or pressing “!” for a few seconds? Texas flexing?

    On this here blog we try to use the facts (inconvenient or otherwise) for an intelligent debate. Think you’re capable of that? You haven’t exactly drowned me in sensible arguments. And you’ve used facts even more sparingly…

    And BTW, I’m not a liberal. I just don’t let either party lead me by the nose.

    Have a nice hot day, y’all!

    Comment by Optimist | August 8, 2008


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