Gasoline prices are on the rise again, mostly due to a combination of turmoil in the Middle East and increased worldwide demand that has driven crude prices up over $100 per barrel. When refiners switch to EPA-required summer blends starting on May 1, gasoline prices will increase even more. The left understands that the harder consumers are hit at the pump, the more sympathetic they are to calls for more domestic oil exploration. In an attempt to head off the issue, Interior Secretary Ken Salazar and Senate Majority Leader Harry Reid and other leftists have fallen back on a tired, discredited canard: the “use it or lose it” approach.
The theory – one that President Obama himself embraced during the 2008 campaign – is that energy companies are “sitting on” leases covering millions of acres of public and Native American lands. Why should the Interior Department issue new leases for oil and gas exploration when the industry isn’t using the resources it already has?
“In fact, it is those same Big Oil companies that are quite literally sitting on the oil that Republicans demand,” Reid said on Tuesday. “Big Oil is sitting on more than 60 million acres of federal land and water. That means nearly 20 percent of our nation’s oil refinery capacity sits idle. They have shown much more interest in making profits than in making oil.”
“The issue we are confronting is not a failure of the government to lease lands or authorize drilling, it’s that millions of acres under lease exist but the industry is not developing them,” Senator Bob Menendez (D-NJ) said yesterday. Menendez, along with Senators Chuck Schumer (D-NY) and Bill Nelson (D-FL) introduced a bill that would force lease holders to drill or forfeit their leases.
Like so many other simplistic leftist ideas, the benefits of this sort of government-mandated approach to oil exploration quickly falls apart as one peels away the layers of the argument. The basic concept starts with an obvious contradiction, for it presupposes that “Big Oil” is so greedy that it will recklessly and knowingly drive up the cost of the product it sells, but is at the same time too stupid to take advantage of those market conditions by producing more of it. In the view of Reid, Salazar and Menendez, the law of supply and demand is somehow suspended when it comes to oil production.
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