James Oglesby’s reply to David Skibbins (Ponzi Scheme, The Independent Coast Observer, Gualala, CA 7/18/08) illustrated textbook economic principles. The following may aid Mr. Oglesby to comprehend Mr. Skibbins’ economic understanding: Mr. Skibbins is a mystery writer, and economics are a mystery to him (leading me to coin the term “Skibbinomics” a couple of years ago).
Mr. Skibbins is not alone, since Democrats are equally mystified. Faced with rapidly rising oil prices, Nancy Pelosi led a Democrat charge against…. commodity speculators! Great shades of Harold Wilson and his 1964 condemnation of the Gnomes of Zürich!
Bush hatred coupled with economic ignorance and myopia make Democrats blame high oil prices on Bush, oil companies, and speculators. Apparently they haven’t noticed the strong economic growth of developing nations – China, India, Brazil, and numerous others – causing prices to increase dramatically since 2002 for resources: aluminum, 96%; copper, 360%; corn, 70%; gold, 125 %; nickel, 452%; steel, 117%; zinc, 314%; and, oh yes, oil, 177%. (see "Let's Shoot the Speculators," by Robert J. Samuelson, Newsweek.com)
Oil prices are set in world markets, and demand has risen sharply while production hasn’t. China and India alone account for 70 percent of increased consumption.
While Democrats blame Bush, oil companies, and speculators, they continue banning drilling in ANWR (2200 acres of mosquito-infested tundra and bog, about the size of a small airport) and offshore (out of sight from land). Democrats fan fears of offshore drilling oil spills, which now average only 6500 barrels a year, or less than four days worth of natural daily seepage.
(see "Stop the Energy Insanity," By Mortimer B. Zuckerman, USNews.com)
Democrats argue that drilling now wouldn’t produce more oil for ten years. That’s what they said ten years ago. Had we drilled then, we’d have more oil now from reserves totaling 96 billion barrels (equal to 200 years of Saudi Arabian imports), plus 420 trillion cubic feet of natural gas.
Unlike Democrat scapegoating, we would actually be doing something to reduce gas prices.