Oil Mythology and the Keystone XL Pipeline - How the Game is Played - Sometimes People Lie

Proposed Keystone Pipeline Route

For the past several years we've been hearing arguments from the political right, usually funded by the American Petroleum Institute (API), an industry lobbying group, that to make America more energy independent and to bring down energy prices we need to ramp up drilling and production in this country.  You know; "drill baby, drill".  Sarah Palin, the half-term governor of a state that gets huge oil royalty windfalls but thinks everybody else should pull themselves up by their own bootstraps, was famously popular for the phrase.  In theory, if the government allowed oil companies to drill without all those nasty regulations and what not, we'd be be paying less than a dollar a gallon for gas.

As you know if you listen to the words of the right wing media machine President Obama's energy policies are what's responsible for gas prices remaining high.  Those good American oil companies want to drill but they can't because of all the EPA laws and regulatory red tape.  If only they were set free to drill baby, drill.  If the Keystone XL pipeline were allowed to be built, bringing oil from the sands of Alberta to terminals on the Gulf Coast, thousands of jobs would be created and our country would be free of it's dependence on foreign oil and OPEC.

Yes the pipeline would create jobs.  Temporary ones while it was being built and then some minor number upon completion if new hires are needed for the terminal and for pipeline maintenance.  But the pipeline would have no effect on gas prices.  More drilling in America won't have any effect on gas prices.  We can drill baby, drill all we want and gas prices will be unaffected.  Flies in the face of common sense doesn't it?  My argument.  If these American companies are producing more oil then of course we'll benefit.

The Republicans working for the API know what I'm talking about.  But they depend on the average American to not know.  Last month, November 2013, was a milestone for oil production in the U.S.  For the first time in almost two decades the U.S. produced more oil than it imported.  As impossible as it might seem given the fact that oil companies aren't allowed to drill under Obama's Hitlerian grip on the throats of capitalists and the tyranny of the EPA, it's a fact.  More production is taking place under the Obama administration than even under the reign of George W. Bush who actually worked in the industry.

Oil Flowing Like Water Out of North Dakota

What has happened is fracking.  In brief, fracking is the practice of pumping water and chemicals into old oil producing areas, breaking up the shale and causing remaining oil to float to the top.  By 2020 it's projected that the U.S. will be the world's top oil producing nation.  Also contributing is the Obama administration's hiking of mileage standards for vehicles which has helped to decrease demand for gasoline.

Republicans argue that the increase in production has happened despite Obama's efforts to quash it because the drilling is happening on state and privately owned lands and production on federal lands has decreased.  The reason for that is that fracking is rightfully not allowed on federal lands and it's cheaper to get oil via fracking than through exploratory drilling on federal lands.  The effects of fracking are still being discovered.  Contaminated ground water is being found in many areas.  Earthquakes in East Texas, sinkholes.  The environmental ramifications are just being realized.  And further, the supply from fracking isn't expected to last more than a decade or two.  Oil is, after all, a finite commodity.

The fact of the matter is that oil companies aren't American anymore.  They are borderless multinationals that work for their shareholders.  Their only concern is making as much profit as they possibly can.  There is absolutely no benefit at all in these companies looking out for anybody but their shareholders and board members.  If Americans are paying more for gas that means more profits and happy stocks.  Even oil produced by these companies doesn't have to stay here.  If they can get more profit exporting American oil to China there's nothing to stop them.  The politically astute or just aware out there will remember these arguments during the debate over ANWAR, the Alaskan National Wildlife Refuge, where BP was trying to open drilling during the Bush years.  That particular effort was cast as a patriotic mission, like manifest destiny, but nothing would have required BP to keep the oil here.  It easily could have gone to Korea, Japan, China.  The highest bidder in other words.

Beyond the fact that oil companies merely want to make a profit, oil prices are set like any other commodity by an international marketplace guided by OPEC primarily.  Oil prices here are dictated by oil prices abroad.  No matter how much oil we produce it would only bring down prices marginally.  In other countries you will occasionally see governments nationalize oil production.  There is zero chance of that happening here.  The API and their congressional allies will keep the status quo and there will always be a bogey man to cast as the villain who is preventing the oil companies from helping us, the common American, out.  For now Obama is the paper tiger.  In the past it has been the Sierra Club, the EPA, WWF, basically any environmental group.

Most of this is just common knowledge but I feel a responsibility to remind people of how this game is played.  We as Americans have such short attention spans these days.  Maybe it's always been this way.  New news replaces the old and we can only retain so much.  But it is a game.  And it's replayed every four years or so.  As gas prices keep creeping higher and higher the only way we can fight back is by decreasing demand.  That's how we can be truly independent from the oil companies.  I feel like such a hypocrite driving my Jeep Wrangler.  It doesn't get 20 miles per gallon.  But it was the only thing I could get financed when i needed a vehicle.

Maybe Americans are finally waking up.  I know a former Tea Party politician

Oil Company Hooker Mary Landrieu (D) Louisiana

who drives a Smart Car.  Hummer, thank God, has been relegated to the dustbin of history.  But you know the game is rigged when even as U.S. demand declines prices stay inflated.  Maybe it's China and India and their increasing consumption and maybe it will only get worse.  But no matter how much we produce here, no matter how much more oil companies are allowed to drill, they will be the only ones benefiting.  We must never lose sight of who the chess pieces are.  There are the oil companies, their lobbying groups, and their drones in Congress.  Not all are Republicans.  Mary Landrieu is a titular Democratic Senator from Louisiana who does more leg work for the oil industry than the most fervent Texas Republican.  She is a good little pet for the API.  It's just important that these people stay reminded that we know who they are and what they're up to.