Common Sense Solutions For Rising Oil Prices

By Semperpapa

We are all witnessing it: a definite rise in the cost of energy.

Gasoline prices are steadily inching up, placing additional stress on the cash flow of the average American family. As are heating costs and electricity rates.

Behind all this is the price of crude oil, which is at the $100/barrel cost, and when that happens, we see an immediate increase of cost of goods at the consumer level.

As usually happens, the increase in crude price sends a sobering shock through the economies of the West due to the total dependency that Western nations have on the producing Arab countries.

At the OAPEC meeting on Saturday in Cairo, Egypt, the oil ministers of the major Arab exporters declared that the current pricing, which has reached the $103.46 level, is an acceptable price and that their nations are not planning to increase production for 2011, although the demand is predicted to increase for that period.

So, once again, the Arab oil producing nations, led by our “friends” the Saudis, is conveniently placing a choke hold on the economies of the West, further putting in question the possibility of an economic rebound across Europe and for the United States.

Besides the ungrateful Saudis, supporting the high crude prices are the Kuwait and Iraqi oil ministers who appear to have a very short memory regarding their current freedom of gouging.

And yet, nothing is being done in Washington to address the issue.

As a matter of fact, Washington appears to be very comfortable with the additional financial burden that increase energy prices are placing on the average American.

Pointing to that direction is the current state of the domestic drilling issue. Last summer, as the Obama administration was clearly using the BP spill in the Gulf of Mexico as an excuse to place a moratorium on all offshore drilling, thousands of people lost their jobs and many small oil companies had to close doors.

But even more frustrating was that as the ban was lifted, new drilling permits have yet to be issued, bogged down in a sea of convenient red tape.

Adding to the frustration of an entire nation is the knowledge that we in the United States are sitting on enough natural resources, crude oil, natural gas and coal, to achieve independence from our enemies, create thousands upon thousands of good jobs and increase our export.

From the desolate tundra of Alaska to the Gulf of Mexico, all efforts to rid our Nation of the yoke of dependency from the OPEC thugs is curtailed by government actions, or more accurately inactions, that defy any logic or common sense.

So, in the spirit of patriotism and common sense, I do have some solutions to this crisis. And this will soon become a crisis that will affect every American even more.

The main goal of the Washington crowd should be the forced march, not walk, toward energy independence. In order to achieve this, America must have a political leadership willing to place the Nation on an industrial war footing that should dwarf the industrial boom witnessed following the Pearl Harbor attack in 1941.

In those days, our Military preparedness was negligible and yet, within few months of national dedication, America became the Arsenal of Democracy.

We are in similar dire times, not because of the danger of an overt enemy, but by the covert actions of enemies hiding behind a façade of pseudo friendship.

Solutions, therefore is to be found in the commitment to reduce at first and eliminate all together, our need for the oil coming from the sands of the Arab world.

Drilling for oil and natural gas should be initiated immediately. Permits should be flying out of the Department of Energy at neck breaking speed, allowing oil companies, especially the smaller outfits, to have access to the immense reserves our country sits on.

Excavation for coal should be fostered by governmental support, not hindrance as the Presidents prefers, so that the heating cost for the American people could be maintained at a manageable level and electricity costs would be manageable.

And dozens of nuclear power plants’ constructions should be planned and started immediately.

When a country like France achieves 70% of their electricity production out of nuclear power, I see no possible reason why our country could not achieve even better.

Just the above three solutions could have a revolutionary effect on our economy.

Drilling and mining would create thousands of good jobs for Americans. When we discuss the construction and placement of an oil rig, for example, it is not just the rig workers employment to be considered. Oil rigs are complex engineering apparatuses, the realization of which demands the application of design and manufacturing.

When a rig is commissioned, it has to be designed and its components have to be manufactured. If the government would relax the regulatory stranglehold on small businesses, there would be a greater potential for American small manufacturing companies to enter the bidding process and be competitive even with the manufacturing counterparts in the Asian countries. And my contention does not even address the issue of product quality control.

Even more on the point would be the construction of nuclear powerplants.

The complexity of such plant would require the application of every single engineering discipline, with the obvious result of creating an enormous number of direct good paying jobs. Relaxation of regulations would allow larger contractors to again utilize the services of smaller companies who, in turn, would have to hire more workers to address the demand. More good paying jobs.

When I speak of relaxation of regulations, I am definitely not speaking of cutting corners, a misconception that the environmental zealots usually get all twisted about. Federal regulations for any sort of governmental contracting are absurd, from the Military to the civilian sectors.

We all remember the outrageous cases of the $500 hammers and the $5,000 coffee pots. Those cases were surely an example of gouging on the part of some companies, but there are many instances where the cost of a small business to comply with Military Standards (Mil-Std) or Quality regulations (like ISO) is so high that only large companies are able to invest in. This environment leaves thousands of talented small businesses out of the game.

Environmental guidelines would have to be met, so that the road to energy independence would have the least impact on the habitat. And that is technology that we already have.

What needs to be eliminated is the quid pro quo approach. By getting the government out of the process as much as possible and by empowering small businesses in the process, we could limit the occurrence of government giving “preferential treatment” to companies like BP in exchange for political contributions.

Large conglomerates like BP love government regulations (that is why they are large contributors to liberal politicians) because they are the only one who have the financial capability to adhere to such restrictive regulations. Relaxing them would create a more competitive environment, undermining their monopoly in the industries. So my suggestions should be appreciated by those folks who are viscerally opposed to the evil corporations.

One last point about alternative energy. After the debacle of the ethanol fiasco, the poor performance of solar power and wind power, there is still a wide open opportunity for research and development of alternative sources of energy. Again, the relaxation and/or removal of governmental regulation have the potential for spurring even more economic growth.

The United States, with its historic hunger for technological innovations, should be at the forefront of that sort of research; we should be independent from the stranglehold from abroad and definitely not allow ourselves to be held hostage.

Just my thoughts!