Monday, April 2, 2012

First the new math - now the new economics

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.

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