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President Biden Needs To Have A Saint Paul Conversion Experience On Inflation!

JimofPennsylvan

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President Joe Biden needs to have a St. Paul type of conversion experience about inflation and quickly especially about his obstructionism on domestic production of oil and gas in America! These words don't come from a place of just a policy difference with the President; but rather, from observing what inflation is doing to ordinary Americans from the standpoint of dramatically hurting their standard of living and quality of life (May's inflation being 8.6%). I am approximately sixty years old and I have not seen inflation harm people's lives like it currently is since 1979-1980 period when the country was on the brink of despair, that time was terrible in the country! It is epically unconscionable that the President isn't reversing course on his energy policies to put this inflation fire out that is acting like a wild fire across the nation destroying significant parts of Americans lives. Gasoline and natural gas prices are a giant part of the problem because their escalation acts like tentacles that permeate throughout our society increasing the prices of countless things across America. This assessment doesn't take a rocket scientist ability to arrive at, it is commonly known amongst business leaders. This past Friday The Wall Street Journal had an article entitled "Fuel Prices Upend Business, Economy" the article supported this contention in its containing "Mondelez International Inc., maker of Oreos and other snacks, said its overall input costs will be up about 10% to 13% this year, with energy prices adding to the cost of transportation, ingredients and packaging. 'It is predominatly related to energy costs and the ripple effect that energy costs have throughout our commodity basket' Chief Financial Officer Luca Zaramella said on a June 1 conference call.".


What President Biden needs to do is to immediately permanently stop his war on domestic oil and gas production in America and in word and deed make it clear to the America's domestic oil and gas producers. My knowledge in this area is limited to just following the news related to the energy issue fairly closely so I don't have the expertise to come up with a laundry list of things President Biden's administration should do, but here is some broad goals. Many domestic producers have ten or less years of oil and natural gas reserves in their portfolio, how do we expect them to dramatically increase production do we really expect them to drill so aggressively that they put themselves out of business in the foreseeable future. The White House needs to come up with and implement a plan to at least double the reserves of these domestic producers and do so quickly. The Biden Administration needs to reverse its decision which changed the Trump administration formula on consideration of environmental impact on regulation of the energy industry and commit to stick with the Trump administration standard for the next five years. Another item is that reports are that America now has a refinery shortage problem which is driving up gasoline prices in part as the report goes it partly is the result of refineries shuttered in recent years. If this is true and the this problem could be significantly helped by reopening shuttered refineries, the President should use the Defense Production Act to reopen and bring these refineries back on line. One important note is that if the cost to achieve this is significant taxpayer money should be provided to the refinery in the form of a loan where it is paid back to the taxpayer from the good profits that refiners are making in this world market.

One question is how to bring more oil and gas supply on to the world oil market because the world supply/demand curve affects world prices and the world energy markets affect the domestic markets. Back in the day Libya was a major oil producer and so was Nigeria and Iraq I believe has something like reserves that would fall into the top five oil reserves in the world. All three countries are relatively low producers because of infrastructures problems due to lack of investment for multiple reasons; the key point is that each country has sufficient reserves where they could dramatically increase production if they had the infrastructure. This idea is not only great for the world but it would be great for these countries because it is so incredibly stupid, like God should perform a supernatural act and give all OPEC leaders bodies of donkeys to represent their donkey behavior, to believe very high and worse oil prices are good for oil producers what this will do is to drive oil consumers to switch to electric power and hydrogen powered vehicles and once they switch they ain't coming back which means they won't be buying your oil and natural gas which means your export revenue will plummet! The idea here is to go to these three countries and say why don't you increase your production we will help you and the mechanism to do it is have is to have the typical private oil companies concessions and development arrangements in foreign countries the twist here is to address the hesitancy of private oil companies in the fear of nationalization of their concession and the practice of private oil companies in developing their concession to do so in a plodding manner so as to not jeopardize the economics of their business. The U.S. government could go to these private companies make an arrangement where the U.S. government will loan you the money to develop the franchise at favorable interest rates and payment terms plus if the foreign government nationalizes the franchise you won't owe anything on the loan unless the foreign government returns the franchise back to you then the loan is reinstated and the loan just applies to that concession your other assets aren't collateral for the loan. Of course, this idea is a little more complex from the standpoint that in Libya America wouldn't want to support concessions in the area controlled by General Khalifa Haftar because that person is a wannabe Colonel Muammar Gaddafi, General Haftar is bad for Libyans and bad for the world no economic help for him. In Nigeria, the country has four gasoline producing refineries all off-line it may be needed to have a concession include a refinery besides production which would increase the size of the U.S. loan. One factor is that a deal would need to be cut with OPEC where not only would the respective country get an increase in the quota they are permitted to ship that if later on OPEC needs to limit production of its members the baseline from which the percentage limit would be cut would be the quota increased limit.


President Biden needs to get a plan together to increase oil and gas production that meets the moment, that stops America's standard of living from sliding off a cliff. I think Secretary Jennifer Granholm is smart enough to draw one up if the White House takes the gun from her head held by an agent of America's environmental zealots and the White House needs to demonstrate to the nation they are on this critical job. To this end they should give Secretary Granholm an Advisory Board with Democrat heavy weights as members to bolster the importance of the effort. It should be a small board like five members that are intelligent, common sense and practical and the Secretary and its board should be acting fast, like the White House should be announcing this action plan within one month's time. If these people were willing to participate and buy into the premise that the administration has to dial back its protect the environment push for the sake of reining in inflation and stabilizing it with the caveat not to be worse on the environment than the prior administration, these would be three picks I think would be good: Larry Summers (former Treasury Secretary), Robert Reich (former Labor Secretary) and David Axelrod (former Senior Advisor to President Obama).
 

Toddsterpatriot

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what this will do is to drive oil consumers to switch to electric power and hydrogen powered vehicles and once they switch they ain't coming back

Hydrogen power?
One of the silliest ideas ever.
 

jwoodie

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All Biden has done is to compress 20 years of America's decline into 20 months. What a guy!
 

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