“Four billion dollars of your money are going to these companies at a time when they’re making record profits and you’re paying near record prices at the pump,” the president said at a Nevada town hall. “It has to stop.” President Obama, April 21, 2011
The President continues to demonstrate his ability to demonize those with whom he disagrees, especially those involved in capitalism and private enterprise. Feeling the heat from citizens about the rising price of gas at the pump, the President tries to focus us towards an enemy — and “big oil” fits the bill because of the enormous amounts of money involved in discovering, developing, transporting and refining fuel so that we can have the freedom to purchase it and use it to our benefit.
We all can identify with “4 Billion Dollars” as being a great deal of money. But what the President isn’t being honest about is that 4 Billion Dollars isn’t very much when it comes to this line of human endeavor. The oil rigs that drill for the oil off the coast can easily cost $1 Billion just to build — so in those terms, we’ve just gotten enough money together to build 4 more drilling units. At one time, there were 19 or 20 such rigs, just in the Gulf of Mexico. This doesn’t sound so outrageous, given costs like this. How about refineries — like the ones we have not built in this country in about 30 years — want to take a stab at how much just one of those might cost?
The President is also trying to deflect our attention from his recent deal with Brazil in which he provided $3 Billion of our tax dollars to Brazil so that they could do more offshore drilling for themselves. So why is it OK for the US government to toss $3B to the folks in Brazil, but it’s bad for all US oil companies combined to have $4 Billion? This is a pretty weak thread to pull, if you ask me.
Oil companies need to make a profit so that they can continue to capitalize additional exploration, drilling and production and serve their customers. Where else does the President expect the money to come from? How can he not understand the need for large amounts of capital in this sector of our economy?
If the President is really spun up about $4 Billion as something that “should be stopped,” I suggest that he pay more attention to the conduct of the federal government, which is the actual responsibility given to him by the voters in November 2008. The federal government is spending nearly $3.7 Trillion dollars this year (and probably nearly that next year), which works out to about $10B per day. Federal revenues (taxes and fees collected) are about $2.1 Trillion, leaving about $1.6 Trillion in debt for this year….or a little more than $4B per day. This isn’t 4B per month or year — it’s $4B per day, every day this year.
This, Mr. President, is the $4Billion that “has to stop.” Now. Not in ten years or 12 years. Now.