DOA; Biden's economic illiteracy; and What's up in Oz?
DOA; Biden's economic illiteracy; and What's up in Oz?
Enemies of the People: Nancy Pelosi
In his Editor’s Column this week, Michael Walsh finds a reflection of our present global reality in a cinematic classic.
Dead on Arrival
At the opening of the 1950 classic film noir, D.O.A., Edmund O'Brien strides purposefully into a big-city police station, proceeds down long, endless corridors, and finally arrives at a door marked Homicide Division. "I want to report a murder," he says to the head detective. "Who was murdered?" asks the cop. "I was," replies O'Brien.
In this, year two of the dreadful administration of Joseph Robinette Biden, Jr., we Americans know just how he feels. From the moment this blustering blowhard of a United States senator of no accomplishment from a meaningless state took office in January 2021, he has been busily poisoning the country for the simple reason that he can, he wants to, and there is no one to stop him.
The beneficiary of the hinkiest election in modern American history thanks to the illegal changes in balloting occasioned by the unnecessary Covid panic, and given the narrowest possible margins of control in both the House and the Senate, the superannuated chief executive has done everything in his power to show his contempt for the American people, to damage our patrimony, and make our lives increasingly miserable.
And yet, like O'Brien, we're not quite dead yet, and still staggering around trying to catch our murderer before time runs out. Barring the hand of God, the first opportunity we'll have to put Biden out to pasture won't come until November 2024, and while the congressional elections this fall could possibly remove both houses of Congress from the geriatric clutches of the bibulous Nancy Pelosi and the baleful Chuck Schumer, that can only stanch but not stop the country's internal hemorrhaging. Like the hapless Frank Bigelow, desperately searching in his last hours for the psycho killer who poisoned him before the "luminous toxin" kills him, we're unsure whom to trust, with both friends and foes suspects alike.
"This can't be happening," we think, but it is. Under the cloak of Covid "emergency"—the punitive lockdowns, the destruction of our education system, the loss of social contact, the delusion that our fellow humans were carriers of a deadly disease who needed to be shunned or even imprisoned—Americans' constitutional freedoms were summarily abrogated without a shot being fired, and we were consigned to effective house arrest (and worse in places like Australia and Canada). Our freedom of movement—essential to life in a country as large as the United States of America—was drastically curtailed and our transportation system deliberately wrecked. Meanwhile the "climate change" canard continued apace, and the push for electric vehicles was intensified, even as the nation's electric grid was tangibly collapsing.
Since Robinette took office, gas prices have more than doubled, part of the Strategic Petroleum Reserve has been emptied, our hard-won energy independence achieved during the Trump era has been frittered away, and we've been reduced to begging erstwhile enemies like the "kingdom" of Saudi Arabia to do the jobs Americans just can't be allowed to do. If this looks like a conspiracy to you, don't worry: it is. And one that the conspirators have been quite open about for decades. They're a suicide cult, hell-bent on killing us as well as themselves….
[T]hose high prices for gasoline and the long, chaotic lines and canceled flights at the airports are not a bug, they're the lynchpin of the whole scheme, which is itself part and parcel of the entire Great Reset project (about which much more tomorrow; watch this space). In order for the Lords of Davos to control you they must first curtail and control your freedom of movement, and what better way to do that than to make the price of oil prohibitively expensive? First your cars stop moving, then the trucks that deliver almost everything of value, including food, to the stores. An inability to move freely and without government oversight will vanish as computers take over your automobiles and which, when they are fully electric, can be disabled at will. As they like to say: You'll own nothing, and you'll be happy.
Continuing on the theme of intentionally high gas prices, here’s Clarice Feldman:
Success: Biden Gets the High Gas Prices He Promised
For decades now, the Democrats have painted gas and oil producers as whipping boys for the failure of their own party’s policies. This year as pump prices have skyrocketed and every single facet of our economy is suffering from the shortfalls in production, they once again seek others to blame. Sticking with their playbook that nothing is ever their fault, despite the fact that the record is clear that it is, President Biden casts the blame on Putin and the producers.
The record is clear, however, that the shortfalls are the direct result of the administration’s policies. And Exxon’s response to Biden’s blame shifting is telling but incomplete. Noting that the company has been in “regular contact with the administration” it describes the steps it has taken to increase production and expand refinery capacity, something the administration has obviously ignored….
Here are some significant specific actions the administration has taken to reduce gasoline supply, something they expressed pride about as it in their words, will speed the transition to “renewables.” And this cockamamie plan certain to raise gas prices was cheered on by the major media
Cancelled the Keystone pipeline bringing crude oil from Canada to U.S. refineries
Pulled three offshore oil lease sales and curbed new drilling this year
Failed to appeal a judicial ruling revoking drilling leases in the Gulf of Mexico
Limited fracking
Issued regulations that strained our already too-limited refinery resources
Promoted new taxes on oil and gas production
And Steven Heyward contributed a related piece, with a special focus on the Biden Administration’s delusions and economic illiteracy.
Biden's Bottomless Energy Foolishness
President Joe Biden followed up his War on Energy—which began the day he took office with his abrupt and malicious cancellation of the Keystone XL Pipeline— with a direct threat wrapped in the flag on Wednesday, demanding in a letter to oil industry CEOs that they increase production while complaining about their profit margins: “There is no question Vladimir Putin is principally responsible for the intense financial pain the American people and their families are bearing. But at a time of war, refinery profit margins well above normal being passed directly onto Americans are unacceptable.”
His verbally-challenged press spokesperson Karine Jean-Pierre followed up with a vague threats that Biden might invoke the Defense Production Act or some other executive powers if the oil industry doesn’t “voluntarily” comply. The fate of President Harry Truman’s seizure of the steel industry in 1952 (declared unconstitutional by a pro-New Deal Supreme Court) must have fallen out of the Biden White House history books, along with any reference works on economic literacy. The facts are these:
Oil production and refining margins are at or slightly below average for all American manufacturing industries (between 5 and 12 percent, depending on region and product), and considerably below several other industries that are Democrat favorites because they’ve gone woke, especially tech.
ExxonMobil is expected to earn less than one-half as much as Apple this year (Exxon: $41 billion; Apple: $100 billion), and Apple enjoys a much larger profit margin on sales than ExxonMobil (Apple: 26 % in its most recent quarter; ExxonMobil, 6.2%). But liberals never criticize Apple’s “profiteering” or Google, or Facebook, or...
Our refineries are running over 92 percent of capacity‚ up from 86 percent last fall, and will likely reach 95 percent this month according to Biden’s own Energy Department. Our refineries can’t increase output much more even if they want to. And the government never offers to backstop oil companies or refiners when market downturns squeeze their margins close to zero, as periodically happens, such as 2009, when refining margins collapsed to -7 percent.
It is impossible to exaggerate the ignorance and hubris—and greed—of the Biden leftists about energy. The Financial Times reported a startling detail a few days ago: “When the White House started calling around in a panic, they thought shale oil production could grow sharply in the near term — like in a matter of months or quarters,” said Bob McNally, head of consultancy Rapidan Energy. “They were shocked to learn that that’s like asking for blood from a stone. It’s almost impossible.”
But it's easy to be shocked when you’ve lost your grip on reality. A CEO of a major American transportation company who agreed to serve on Barack Obama’s Council on Jobs and Competitiveness back in 2011 once privately told me that he asked Obama why we didn’t encourage more domestic production of oil and natural gas. Obama’s answer stunned him: “Stephen Chu [the Nobel Prize-winning Secretary of Energy] tells me we’ll be well on our way to a transition to renewable energy by 2016, so we don’t need more oil and gas.”
President Biden seems even more self-deluded about oil and gas than Obama, peddling the same dreamy nonsense about energy. Last month Biden said that high gasoline prices were part of the “incredible transition” toward a world of “renewable” energy that won’t need fossil fuels. But the inexorable rise of gasoline prices has set off political alarms in the White House, prompting the administration to try to make nice with domestic oil and gas—and even with the Saudis, otherwise a pariah state for this administration—in hopes they will increase oil production and relieve Biden’s political gas pains.
But Biden’s grasp of the oil and gas industry is as simplistic and confused as every other aspect of his doddering administration. Having demonized the oil and gas industry as required by environmentalist orthodoxy, Biden now thinks he can get the industry to bail him out of his self-induced political and economic crisis.
There are two primary reasons why domestic oil and gas can’t be turned on or off like a water faucet in your kitchen. The first is long-wave oil market cycles. The second is political and regulatory risk. The oil and gas industry has at length figured out how to adapt to the first problem. The second problem—political and regulatory risk—is out of their hands, and is the one thing Biden and his gang refuse to acknowledge or consider changing.
Joan Sammon gave us a tour of the members of the bigwigs in the Biden Administration who are forging the president’s climate policy.
Behold, the Biden Energy 'Brain Trust'
Who are these people? Instead of being confused and frustrated, a review of the crew steering this ship actually brings clarity and understanding:
Jennifer Granholm, U.S. Energy Secretary
While presenting via video feed in May 2021 at the Williston Basin Petroleum Conference, only months after joining the administration, attendees were aghast at her stunning lack of knowledge about the sector she had been tasked to lead. A graduate of Harvard Law School, she had been the Attorney General of Michigan, and then governor until 2011, with a quick stint as a member of Barrack Obama’s transition team in 2009; she was unsurprisingly ill-suited for an industry-focused position. Between the cancellation of the XL pipeline 90 days prior to her speech, her incorrect use of industry vernacular and her disingenuous assurances that she was on a shared journey with the industry she would be working to dismantle, the audience was left deeply dissatisfied.
When asked Wednesday at what point do gas prices become unsustainable?" Granholm responded, "Yeah, I think the prices are unsustainable… there's not a quick fix. However, your point about also accelerating our progress toward clean energy is very, very important."
John Kerry, Special Presidential Envoy for Climate
Perhaps best-known for his service in Vietnam, Kerry was also in the U.S. Senate for many years before serving as secretary of state under Barack Obama. Since then he has been jet-setting (via fossil-fuel powered jets) to Davos and other destinations in Europe speaking about the threat of fossil fuel to the planet.
Speaking at an event hosted by the University of Southern California's Center of Public Diplomacy last Friday, Kerry said that energy security concerns are driving complaints that the U.S. needs to perform more domestic drilling and return to coal. Annoyed, he said that the U.S. "absolutely" does not need to drill for more oil and gas amid inflation and record-high gas prices.
Gina McCarthy, National Climate Advisor
Rounding off the energy triad is a former Obama-era EPA administrator. Her role in the Biden administration was seen as a domestic counterpart to John Kerry's job on the international front. According to reports, McCarthy was described as the chief architect of Obama's climate regulations, overseeing the drafting and passage of limits on what she referred to as, "planet-heating pollution" from power plants, vehicles and fossil fuel producers. Following a stint as a professor at Harvard University, she became the president and chief executive of the Natural Resources Defense Council. She recently defended censorship of news sites that deny "climate change" or other accepted orthodox pieties of the Left:
We have to get tighter, we have to get better at communicating, and frankly, the tech companies have to stop allowing specific individuals over and over again to spread disinformation. That’s what the fossil fuel companies pay for.
Peter Smith gave us a rundown of the political situation in Australia after the recent elections there.
Trouble in Oz for Albo and the Ghastly-Green Fourteen
The left-wing Labor Party narrowly won a majority in the May Australian federal election. It holds 77 of the 151 seats in the House of Representatives. It faces Liberal and National Parties, together holding 58 seats, and 16 assorted cross benchers. Of the cross benchers, an assorted ghastly-green fourteen will form, without much doubt, a cacophonous green choir. Nothing that Labor does on climate will be enough. And if that weren’t nearly enough, the Greens (party) will hold the balance of power in the Senate. Interesting times for the new government.
The Labor Party is not the natural party of national government in Australia. In the seventy-seven years since the end of WWII it has formed government only one-third of the time. The (now notionally) centre-right Coalition of the Liberal Party, largely representing urban areas, and the National Party, representing regional and rural areas, has formed government for the balance of the time.
Labor last formed government from 2007 to 2013. It was ugly. Prime minister Kevin Rudd was sacked in mid-first term and replaced with Julia Gillard. The 2010 election was all but lost. Gillard was subsequently sacked and Rudd resuscitated to try to save some seats at the 2013 election. To not much avail. Tony Abbott took the Coalition to a resounding win. Abbot used two principal slogans: “stop the boats” (carrying so-called asylum seekers) and, most notably, “axe the tax” (namely, the proposed carbon tax). Voters want climate-change action. Don't want to pay for it.
New Labor prime minster Anthony Albanese is quite evidently apprehensive. He doesn’t fancy traversing the same rocky road as Rudd or Gillard. Yet, only weeks into office, gas and coal shortages appear, energy prices soar.
What to do in these circumstances; when the election’s been won on climate action, reducing electricity prices and creating lots of green jobs? When, moreover, the cross-bench members of parliament have become greater in number and even more pathologically fixated on combatting climate-change? When they all, without the pesky burden of governing, want emission-reduction targets to go well beyond, and much more speedily beyond, the 43 percent (on 2005 levels) promised by Labor by 2030 and the net-zero promised by 2050?
It’s a rock and hard place. Which way will Labor go? For now, it’s Realpolitik. How could it not be? At the end of May, the wholesale price of natural gas in the states of New South Wales and Victoria spiked 50 and 80 times higher. That’s not a misprint. The Australian Energy Market Operator, responsible for keeping the lights on, responded by putting in place a temporary price cap of $40 per gigajoule. Still four times its not-so-long-ago average price of around $10.
Tom Finnerty contributed two pieces for us this week. In one he discussed how the Canadian Trucker Convoy has continued to influence Canadian policy, long after they were forcibly dispersed.
Canada's Freedom Convoy Still Paying Dividends
In the other, he walked through an amusing Wall Street Journal piece which followed a woman who rented an electric car for a 2,000 mile road trip and ended up spending more time charging it than she did sleeping.
'At the Mercy of this Goddamn Spaceship'
Thanks for reading, and keep a look out for upcoming pieces by Jenny Kennedy, David Solway, and a special sneak preview of a special project that we’ve been working on. All this and more this week at The Pipeline!