We are now hearing from one party that increased domestic supplies of oil will not affect prices while increased supplies of foreign oil will affect prices. This is because while the president and his party have been arguing against increased domestic production, other members of his party, notably Chuck Schumer has said that increased supplies by the Saudis have decreased prices. So who taught these people economics? As I have said before, politicians always try to repeal the laws of supply and demand. They always fail. We have heard time and time again that even if we started to exploit domestic supplies, that it would be years before the oil came on line. Both Jimmy Carter and Bill Clinton made that argument. If we had started drilling and fracking then, that oil would now be in use. Anyway, if Obama had approved the Keystone pipeline, futures prices would have fallen already. I personally have never understood this opposition to domestic oil. Oh sure, I know the irrational environmentalists who yearn for a simpler, poorer more bucolic existence. But spare me. I do not yearn for the good old days. I yearn for plentiful supplies of oil and gas. And with that, much lower prices of gasoline and energy.
Harold A. Black is professor emeritus in the Department of Finance, University of Tennessee, Knoxville having retired after 24 years of service. He has served on the faculties of American University, Howard University, the University of North Carolina - Chapel Hill and the University of Florida. His government service includes the Office of the Comptroller of the Currency and as a Board Member of the National Credit Union Administration. He also has served on the boards of directors Home Savings of America and its parent company, H. F. Ahmanson & Co., Irwindale, California prior to its merger with Washington Mutual Savings Bank, on the board of New Century Financial Corporation, Irvine, California, then the nation’s largest real estate investment trust and as director and later chairman of the Nashville Branch of the Federal Reserve Bank of Atlanta. He writes an occasional article for the Knoxville News-Sentinel at http://www.knoxnews.com/staff/dr-harold-black/. His web page is haroldablackphd.com