Obama’s HOPES For High Gas Prices Dashed; Media Silent.
Why am I, again and still, not surprised? From PoliticallyDrunk:
Media Silent On Collapse Of Obama’s Energy Plan!
With prices dropping to as low as $2.59 in some states, the media is eerily silent on the reality that Senator Obama’s Energy Plan has essentially collapsed along with oil prices that have dropped to around $70/barrel. Most Americans, with the willful help of a silent media, will never realize that even as Senator Obama is attacking big oil companies and continuing to call for an energy plan that would cost $90 billion in the first year alone, that oil company profits and stocks have taken a beating and more importantly the Windfall Profits Tax that Obama will use to pay for his Energy Plans will not generate a single penny. [...]
Senator Obama’s Energy Plan is predicated upon two investments: A $15 billion per year ‘green’ investment and a one-time $75 billion energy rebate. On the campaign trail, Senator Obama continues to state that his energy plan will pay for itself through his proposed Windfall Profits Tax. Yet, that very Windfall Profits Tax is based upon a tax that is imposed when oil prices exceed $80 per barrel. In order for Obama’s WPT to generate $15 billion per year, oil prices would have to remain above $92 per barrel. Of course if oil prices were to increase to $120 per barrel, the tax would impose a $58 billion per year cost to the oil companies (over 1/3 of their profits).
So as of today, in a weak global economy, Senator Obama’s plan has no funding. As a result, his Energy Proposals would add over $90 Billion dollars to the federal deficit in the first year alone. In addition, we know that even if oil prices were to re-emerge above the $92 per barrel mark, the WPT (which failed miserably the first time) would create an environment whereas producers would maximize their profits by producing oil overseas and selling that oil overseas where there is no additional tax. Ultimately, if energy prices continued to rise, the oil industry would abandon US production and limit importation to the US. After all, if you could make more money by selling your oil to Britain, or China, or India, wouldn’t you do just that?
Obama’s Energy Plan is nearly identical to that of Jimmy Carter 30 years ago, and like that of President Carter, Obama’s plan is destined to drive away US production. Even Senator Clinton, another supporter of the WPT had enough sense to recognize that Obama’s WPT proposal was unrealistic and abusive. Senator Clinton’s proposed WPT was designed to provide a minimal tax, that would generate a total of $2 billion per year, 8 times smaller than that of Senator Obama.
But the real issue today is not the long term failure of this tax that history has proven will reduce domestic production. Today’s issue is the fact that at current prices, the plan has failed before it has even begun. The media is silent and willfully overlooking the fact that every time Senator Obama mentions his plan, he is failing to tell the American public that they will have to endure much higher fuel prices in order for the tax to generate a single penny for the government.
So this election day every American has a choice, you can support a candidate who wants to keep short term energy prices low, thereby retaining US wealth to be invested in alternative energies; or we can support a candidate whose entire energy plan is based upon funding that can only occur if we are willing to pay much higher gas and energy prices both today and in the future.
I’ll say it again… someone please find the ‘unbiased’ media and point them home.
Clearly you stay on top of whats going on with our economy, and what affect our new president is going to have on it. Your artical is the first I’ve heard about this topic. I am curious about a couple things that you said though. In your first paragraph you wrote “the Windfall Profits Tax that Obama will use to pay for his Energy Plans will not generate a single penny.” I don’t understand how that is possible. If the plan is to raise a tax, how can they be gaining nothing? You also stated, the Windfall Profits Tax is imposed when oil prices exceed $80 per barrel. Do you have any idea why that is? I feel like you have failed to see the positive in this proposed energy plan. It will put pressure on the oil companies to keep their cost per barrel down, which would reduce stress on a week economy. What is the probability that they would give us the finger and move somewhere else?
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Check out this video about gas prices! http://www.thetruthabout.com/public/266.cfm?affID=and16
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