FacebookTwitterGoogle+RedditEmail

Sweetheart Oil Deals

by THOMAS KNAPP

To the extent that the second debate between US president Barack Obama and aspirant Mitt Romney is generating media punditry buzz, that buzz centers mostly around the attack on the US consulate in Benghazi, Libya on September 11: What did Obama know, when did he know it, and so forth.

That’s all very interesting, I guess, but for me the key moment in the debate came early when the two candidates engaged on the subject of energy prices.

Obama pointed out that domestic US oil production has increased during his tenure in office, and that that increase has substantially been a private sector phenomenon.

In response, Mitt Romney — Mister “47% of the people … are dependent on government … feel they are entitled …” — whined that the Obama administration has been insufficiently charitable with “public” land (and taxpayer money) toward the oil companies.

It’s important to understand how such sweetheart “public” land use deals work. This is a subject I started following back in the 1980s when I read an article about leases of national forest land to timber companies. At that time, for every dollar a timber company paid in leasing fees, the US government spent $1.27 on road-building and other projects to enable the exploitation of those timber leases. Or, to put it a different way, the net budget impact was a 27% welfare check to the timber company from Uncle Sugar — prior to and excluding any profits the company might make on the timber itself!

My brief dips into subjects such as the proposed Alaska National Wildlife Refuge drilling kerfuffle indicate that nothing has changed over the intervening decades. So far as I know, the next time a natural resources extraction company offers to cover the entire cost of its own operations on “public” land, let alone deliver a net profit to the US government on the deal, will be the first time.

So now you know why these companies prefer operating on “public” versus “private” property: Taxpayer subsidies make it more profitable. And you know that Mitt Romney’s promise of lower gas prices by opening up more “public” land to drilling is a sleight of hand. He wants to hide some of the cost of gas in your 1040 or on the federal debt ledger instead of letting it be displayed honestly at the pump, so that you pay more while imagining that you pay less.

My point, mind you, is not that Obama is any better than Romney when it comes to corporate welfare. Can you say “individual mandate?” The Affordable Care Act alone is the biggest welfare check to the health insurance industry since Nixon’s HMO Act.

Both candidates are beholden to sets of corporate and special interest benefactors — the bulk of the political class — who expect beaucoup return on their investments. The mission of the state, after all, is to redistribute wealth from the pockets of the productive to the bank accounts of the politically connected. The current presidential contest is just another quadrennial re-appraisal and re-division of the spoils. And it doesn’t really matter that much who wins. They’ll all end up making out like the bandits they are, and you’ll be bled just a little more dry to cover the ever-increasing costs.

For those who oppose “welfare” — be it food stamps which allegedly benefit the poor while actually fueling subsidies to Big Agriculture, or oil leases which allegedly lower gas prices while piping your money to Big Oil via the back door — the only answer is to dispense with political government itself. “Welfare” for the already rich is its raison d’etre.

Thomas L. Knapp is Senior News Analyst at the Center for a Stateless Society.

Thomas L. Knapp is director and senior news analyst at the William Lloyd Garrison Center for Libertarian Advocacy Journalism (thegarrisoncenter.org). He lives and works in north central Florida.

February 10, 2016
Fred Nagel
The Role of Legitimacy in Social Change
Mike Whitney
Putin’s Aleppo Gamble Pays Off
Ramzy Baroud
Next Onslaught in Gaza: Why the Status Quo Is a Precursor for War
Mark Boothroyd
Syria: Peace Talks Collapse, Aleppo Encircled, Disaster Looms
Sheldon Richman
End, Don’t Extend, Draft Registration
Benjamin Willis
Obama in Havana
Jack Smith
Obama Intensifies Wars and Threats of War
Rob Hager
How Hillary Clinton Co-opted the Term “Progressive”
Lawrence Ware
If You Hate Cam Newton, It’s Probably Because He’s Black
Jesse Jackson
Starving Government Creates Disasters Like Flint
Bill Laurance
A Last Chance for the World’s Forests?
Gary Corseri
ABC’s of the US Empire
Chris Martenson
The Return of Crisis: Everywhere Banks are in Deep Trouble
Frances Madeson
The Pain of the Earth: an Interview With Duane “Chili” Yazzie
Binoy Kampmark
The New Hampshire Distortion: The Primaries Begin
Andrew Raposa
Portugal: Europe’s Weak Link?
Binoy Kampmark
The New Hampshire Distortion: the Primaries Begin
Wahid Azal
Dugin’s Occult Fascism and the hijacking of Left Anti-Imperialism and Muslim Anti-Salafism
February 09, 2016
Andrew Levine
Hillary Says the Darndest Things
Paul Street
Kill King Capital
Ben Burgis
Lesser Evil Voting and Hillary Clinton’s War on the Poor
Paul Craig Roberts
Are the Payroll Jobs Reports Merely Propaganda Statements?
Fran Quigley
How Corporations Killed Medicine
Ted Rall
How Bernie Can Pay for His Agenda: Slash the Military
Neve Gordon
Israeli Labor Party Adopts the Apartheid Mantra
Kristin Kolb
The “Great” Bear Rainforest Agreement? A Love Affair, Deferred
Joseph Natoli
Politics and Techno-Consciousness
Hrishikesh Joshi
Selective Attention to Diversity: the Case of Cruz and Rubio
Stavros Mavroudeas
Why Syriza is Sinking in Greece
David Macaray
Attention Peyton Manning: Leave Football and Concentrate on Pizza
Arvin Paranjpe
Opening Your Heart
Kathleen Wallace
Boys, Hell, and the Politics of Vagina Voting
Brian Foley
Interview With a Bernie Broad: We Need to Start Focusing on Positions and Stop Relying on Sexism
February 08, 2016
Paul Craig Roberts – Michael Hudson
Privatization: the Atlanticist Tactic to Attack Russia
Mumia Abu-Jamal
Water War Against the Poor: Flint and the Crimes of Capital
John V. Walsh
Did Hillary’s Machine Rig Iowa? The Highly Improbable Iowa Coin Tosses
Vincent Emanuele
The Curse and Failure of Identity Politics
Eliza A. Webb
Hillary Clinton’s Populist Charade
Uri Avnery
Optimism of the Will
Roy Eidelson Trudy Bond, Stephen Soldz, Steven Reisner, Jean Maria Arrigo, Brad Olson, and Bryant Welch
Preserve Do-No-Harm for Military Psychologists: Coalition Responds to Department of Defense Letter to the APA
Patrick Cockburn
Oil Prices and ISIS Ruin Kurdish Dreams of Riches
Binoy Kampmark
Julian Assange, the UN and Meanings of Arbitrary Detention
Shamus Cooke
The Labor Movement’s Pearl Harbor Moment
W. T. Whitney
Cuba, War and Ana Belen Montes
Jim Goodman
Congress Must Kill the Trans Pacific Partnership
FacebookTwitterGoogle+RedditEmail