A friend emailed me about Bob Corker's involvement in the Gang of 10. He asked, "What is Corker doing?" To quote Bob Corker himself, he is doing "...exactly what I came to the Senate to do." To the host of Tennesseans who bemoaned the choice of Corker over Ed Bryant as our Senate choice in 2006, he's doing exactly what we feared. In fairness, for two years Corker has been a pleasant surprise. However, he couldn't have picked a worse time to begin living down to our expectations.
Just like GOP Senators in the Gang of 14 and judicial nominees, Republicans in Energy's Gang of 10 are undermining GOP leadership and strategy. Mitch McConnell and GOP leaders have worked this issue for months with the backing of Republicans and Democrats; legislators and voters. Pressure was mounting on Democrats to surrender their sellout of Americans. Gas and oil prices were falling. Support for Energy Independence via drilling and R&D for alternative and renewable energy sources was growing. It seemed inevitable the GOP would get their vote and sooner rather than later. Now, thanks to meddling by Corker, instead of continuing to exploit flaws in Democratic policies, Senate GOP leaders might be forced to regroup and decide if they can even continue in the face of the Gang's treachery.
Worse is Corker's betrayal of Tennesseans and Americans in general. The Gang's proposals ask for less concessions than GOP leadership would likely have been able to get from the Senate. The Gang does call for drilling. But they accept serious restrictions on drilling the GOP would likely not have needed to give up; restrictions which make the oil produced more expensive. Drilling 50 miles offshore is more expensive than drilling 15 miles offshore. Unmentioned is most oil we already know about is inside the Gang's 50 mile ban meaning more time and expense for exploration.
Then there are the taxes. $84 billion worth. That's what Corker proposes taking from oil companies who successfully find oil outside of 50 miles. It doesn't sound too bad to Americans at their kitchen tables figuring how to pay for fuel. They don't call it a tax and so taxpayers are off the hook, right? In fact it even sounds helpful.
The proposal also seeks to provide tax incentives for converting cars to non-oil fuel sources, including $20 billion for research and development, grants to help U.S. automakers develop alternative fuel vehicles and consumer tax credits for purchase of highly efficient cars.
5 Republicans signed on to this? How exactly will this help Americans pay for fuel anytime soon? What widely available, inexpensive, "non-oil fuel source" currently exists for Americans to convert to? Propane? Driven past a commercial propane station lately?
R&D grants to automakers clearly indicate any benefits are expected to be future ones. Even the current existence of increasingly fuel efficient cars to which proposed tax credits might be applied is misleading. They are brand new cars, not used ones; many sporting new technology making them even more expensive. Corker's plan is to give Americans a $2,500 tax credit, for example, to buy a $25,000 car? This is making things more affordable?
Add to this the plan's call for 85% of cars on the road by 2028 to run on non-petroleum fuel and you see how much this will cost American families already unable to afford $4 gas. Considering there are at least 100 million vehicles now on the road, Americans and American business will have to replace or modify 85 million vehicles in the next 20 years. At $2,500 to $25,000 per vehicle that's a $212.5 billion to $2.125 trillion high drag, low speed burden the Gang imposes on Americans and the American economy in the name of saving us from high prices. It sounds like the joke about buying things one doesn't need because they are on sale and justifying the purchases based on "savings"!
Worse, there won't be any real savings. Adding $84 billion to oil companies' cost of production only means the product produced will cost $84 billion more at the pump. Americans are going to pay more thanks to Corker and the Gang. R&D is fantastic. Even if it takes years to bring something to market, the wait is generally worth it. But at issue is what do Americans do in the meantime? Cheap oil now while we transition is better than expensive oil now until we transition.
The final insult is that oil produced under the Gang's plan cannot be sold outside the US. Democrats have whined for years about losing good jobs and weakening the Economy. Here is an opportunity to create jobs and fuel the Economy and Corker and the Gang won't allow it. Brazil has enjoyed record economic growth and job creation as it has changed from a net oil importer to a net exporter over the last 5 years or so. But for Corker and the Gang, oil production beyond that necessary to eliminate US oil imports cannot be sold on world markets. The jobs, economic growth and general prosperity oil exporting nations enjoy is denied to America and her citizens, corporate and individual.
Thus the next command from government beyond where we drill and where we sell will be how much we produce. Only produce here; only sell there - as if government owned the oil. Couple these restrictions with government requirements that Big Oil finance R&D which makes their product less marketable and you complete the picture of the ignorance the Gang wants foisted on the American public as beneficial. And Bob Corker says this is exactly what he wanted to accomplish in DC. Corker and the Gang would be better advised to join up with their GOP House colleagues' #Don't Go Movement. It provides all the benefits they say they want with none of the drawbacks.
To recap, the R&D the Gang proposes won't be helpful for years. They tease you with tax credits for far off R&D results you'll end up paying for later anyway via the same high prices they claim to be fighting. As beneficial as R&D is for tomorrow, today's prosperity requires inexpensive, readily available oil. The immediate burden of surviving lean R&D years falls on Big Oil. But they must work while prevented from drilling in the best places, selling for the best prices or providing the best wages and profits for Americans; all the while dealing with government imposed reductions on the value of their market and product.
Thanks, Bob! Do us a favor and don't Gang up on us anymore. We can't afford it!