April 16, 2008
Democratic Debate: Oil
Obama: "The only way we can lower fuel prices is by increasing fuel economy standards and reducing demand."
Quick, what's an economic theory that forms the foundation of any market-based system?
C'mon, Obama already gave you part of the answer ...
Demand ....
Demand and ....
sigh.
Supply and demand, people.
Neither candidate said anything about increasing the oil supply to alleviate the high prices resulting from growing demand. There's oil aplenty in the United States, but we need to extract it. Then we need to build refineries to turn it into fuel.
But Obama and Clinton prefer to practice retardonomics, completely ignoring the possibility that big, bad oil companies could help, if only Congress would get out of the way and let them tap the billions of black gold locked beneath ANWR, under the waters of the Pacific coast and the Florida Keys.
Posted by Mike Lief at April 16, 2008 06:39 PM
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Comments
Supply and demand are two factors which govern prices. Each can contribute to the equation, but that doesn't mean that politicians must try to influence both sides of the equation.
The fact that I can reduce the price of oil by drilling every drop that exists today, doesn't mean that's the only way to reduce costs. Cutting demand will do that too and it's the more important part of the equation since no matter how much oil we drill for, demand will, over the next few decades, rise beyond our capacity to fill the need regardless of how much drilling we do, unless we figure out ways to reduce how much each car uses.
If we can't figure out how to decrease the per-person demand for oil, we're in trouble since there are 2 or 3 billion people in the developing world who are beginning to want cars of their own. In particular, as the people of China and India increase the number of cars they drive, several inevitable truths will occur. Demand will skyrocket. Supply may increase slightly, but will be unable to meet demands. As a result, prices will climb. A lot.
We can try to stave off that effect for a few years by drilling in ANWR or Texas or off the coasts of several of our states. But even if we throw all thoughts at conservation out the window, we will still not be able to meet worldwide demand without greatly increasing prices.
The "Borrow and Spend Republicans" don't seem to care about how their children will pay for the debt they keep increasing. If they also think that increasing supply is a way to avoid increasing prices beyond what their kids will be able to afford, they really are living in a dream world. If they want their kids to be able to afford to drive a car of their own, they've got to come to terms with the need for increased fuel efficiency, alternative fuels, and more mass transit. Or raise kids who can afford to pay many times more per gallon than we're paying now.
Posted by: BullButz at April 21, 2008 09:48 PM