Secretary of State has it wrong on drilling

By Richard Leonetti,

Secretary Bradbury wrote an op-ed piece saying we should not drill for oil. His arguments were riddled with contradictions and some speculation.  He asserts that expanded drilling will increase gasoline demand. Actually increased drilling has no affect on demand but will increase domestic supply or keep it from falling as it is now doing. This in turn would tend to lower costs and help, not “hurt Oregonians”, as he claims. I thought he wanted lower costs?

He also says that we should start now to develop other energy sources that might take 10 years to occur. If it is good to invest now, presumably taxpayer money, for returns in the future it certainly is even more advantageous to start drilling now. Drilling costs the taxpayer nothing and actually reduces taxpayer burdens because the leases are “sold” to prospectors for cold hard cash. They also create new jobs and taxes.

This argument that it will take too long to bring in new oil is very much like the 30 year old saying that there is no sense in saving for retirement now he can just take his chances later that he might win the lottery. Sooner is always better than later.

Lastly his speculation that alternative energy pursuits will create lots of jobs is just that, speculation. We do know, however, that less oil and gas will affect current jobs. Higher natural gas costs drive up the cost of of many products. Farm jobs would be affected by higher fertilizer costs making the product more expensive. Diesel fuel costs affect trucking, rail and airlines making hundreds of products more expensive. This country thrives on cheap transportation to get our products to markets including the ports for export. Not to mention that every barrel of oil and every BTU of gas we produce here does not need to be purchased with US funds sent to foreign countries, some of whom are not our friends.

With environmental safeguards, drilling now is a logical and an economic benefit to us all and we should pursue it.

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One Response to Secretary of State has it wrong on drilling

  1. Edward says:

    On the point over increasing energy demand, you and Bradbury are both correct. An increase in supply would result in lower prices in the short term, but lower prices would in turn increase demand in the long term. Cheap energy always spurs economic growth but the new larger economy results in a need for more and more energy. Your claim that more drilling only increases supply would only be true if the economy was frozen and static (I assume you support drilling not just as a way to lower energy costs but also to keep the economy growing). Your disagreement with Bradbury seems to be how to get to cheaper energy and whether the type of energy that makes up the supply is important, not over the basics of supply and demand.

    In addition, you seem to falsely equate the granting of a lease to drill with actual drilling. Even if we grant lots of new leases to drill, how do we mandate that drilling actually proceed? There is always a certain amount of overhead and up front cost to any new drilling activity and the market itself will cause oil companies to drill when prices are high. However, as prices come down drilling becomes less profitable and new drilling less likely (that’s how we get the traditional up and down in the markets). New leases, by themselves will not prevent the free market. If you really want long-lasting cheap energy the only way is to artificially tinker with the free market (drilling subsidies, etc.). Are you in favor forcing the hand of oil companies to actually proceed with drilling when the free market doesn’t cause them to? If so you end up not too far away from nationalized energy companies.

    My overall point is that this issue is a lot more complex than you make it sound. If more drilling was the answer, than why haven’t past oil drilling booms solved the problem (because we always need more). So, to say that drilling is the answer now only makes sense in a very short term outlook or in a world with unlimited oil. What do you think the long-term solution to our energy needs is? When does more drilling cease to be sufficient? 10 years? 50 years? Infinity?

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