Posts Tagged ‘government


President Bush: “Big Oil!”

Let’s face it … it’s very hard to find a politician who understands anything today.  They’re driven by campaign fund raising, sound bytes, and vote pandering.  Some days … I think they’ll just say anything … but then on other days … I realize they just plain don’t know/understand what they’re talking about.Vintage_Oil_Cans_Service_Station_Lights

Well, I found a politician who does understand, at least some things.  His name is President George W. Bush.

The following is from the Q&A session that followed the President’s Press Conference on July 15, 2008 with a few of my own comments thrown in.  Any text highlighted was done by me.

Q Gas prices are now approaching $5 a gallon in some parts of the country. Offshore oil exploration is obviously a long-term approach. What is the short-term advice for Americans? What can you do now to help them?

THE PRESIDENT: First of all, there is a psychology in the oil market that basically says, supplies are going to stay stagnant while demand rises. And that’s reflected somewhat in the price of crude oil. Gasoline prices are reflected — the amount of a gasoline price at the pump is reflected in the price of crude oil. And therefore, it seems like it makes sense to me to say to the world that we’re going to use new technologies to explore for oil and gas in the United States — offshore oil, ANWR, oil shale projects — to help change the psychology, to send a clear message that the supplies of oil will increase.

Secondly, obviously good conservation measures matter. I’ve been reading a lot about how the automobile companies are beginning to adjust — people — consumers are beginning to say, wait a minute, I don’t want a gas guzzler anymore, I want a smaller car. So the two need to go hand in hand. There is no immediate fix. This took us a while to get in this problem; there is no short-term solution. I think it was in the Rose Garden where I issued this brilliant statement: If I had a magic wand — but the President doesn’t have a magic wand. You just can’t say, low gas. It took us a while to get here and we need to have a good strategy to get out of it.

theClassicLib: There has been a lot of hyperbole about “speculators” lately (see here), however, the President clearly understands the law of supply and demand.  He understands that even the idea of increased world oil supplies will reduce the price of futures contracts currently being bought.  This is no different than when shares of company XYZ decline on a rumored earnings warning some time off in the future.

Bush also points out that consumers, not government drive markets (aka supply and demand), and that nobody in government has a magic wand to make economic changes on demand.

Q But you do have the Strategic Oil Petroleum Reserve. What about opening that?

THE PRESIDENT: The Strategic Oil Petroleum Reserve is for, you know, emergencies. But that doesn’t address the fundamental issue. And we need to address the fundamental issue, which I, frankly, have been talking about since I first became President — which is a combination of using technology to have alternative sources of energy, but at the same time finding oil and gas here at home. And now is the time to get it done. I heard somebody say, well, it’s going to take seven years. Well, if we’d have done it seven years ago we’d be having a different conversation today. I’m not suggesting it would have completely created — you know, changed the dynamics in the world, but it certainly would have been — we’d have been using more of our own oil and sending less money overseas.

theClassicLib: Right!  Everyone today is so focused on the immediate (which requires the use of that magic wand), that they can’t see the forest through the trees.  Now is the time to start drilling, so we don’t have the same (or worse) conditions a mere 7 years from now.

Q Mr. President, understanding what you say about energy supplies being tight and the debate over energy … one thing nobody debates is that if Americans use less energy the current supply/demand equation would improve. Why have you not sort of called on Americans to drive less and to turn down the thermostat?

THE PRESIDENT: They’re smart enough to figure out whether they’re going to drive less or not. I mean, you know, it’s interesting what the price of gasoline has done, is it caused people to drive less. That’s why they want smaller cars, they want to conserve. But the consumer is plenty bright, Mark. The marketplace works.

So no question about what you just said is right. One way to correct the imbalance is to save, is to conserve. And as you notice my statement yesterday, I talked about good conservation. And people can figure out whether they need to drive more or less; they can balance their own checkbooks.

theClassicLib: This Q&A addresses a fundamental difference between today’s Left and Right.  On the Left, they simply don’t believe people can and/or will make good choices in their lives without the explicit direction (and regulatory authority) of the Federal Government.  On the Right, there is trust in individuals to make wise choices for themselves and their families.

This is further illustrated in the following Q&A …

Q But you don’t see the need to ask — you don’t see the value of your calling for a campaign —

THE PRESIDENT: I think people ought to conserve and be wise about how they use gasoline and energy. Absolutely. And there’s some easy steps people can take. You know, if they’re not in their home, they don’t keep their air-conditioning running. There’s a lot of things people can do.

But my point to you, Mark, is that, you know, it’s a little presumptuous on my part to dictate to consumers how they live their lives. The American people are plenty capable and plenty smart people and they’ll make adjustments to their own pocketbooks. That’s why I was so much in favor of letting them keep more of their own money. It’s a philosophical difference: Should the government spend their money, or should they spend their own money? And I’ve got faith in the American people.

And as much as I regret that the gasoline prices are high — and they are — I also understand that people are going to make adjustments to meet their own needs. And I suspect you’ll see, in the whole, Americans using less gasoline. I bet that’s going to happen … And as you notice, the automobile industry is beginning to adjust here at home as consumer demand changes. And the great thing about our system, it is the consumer that drives our system; it’s the individual American and their collection that end up driving the economy.

theClassicLib: Yes, it’s a philosophical difference.  No additional comment needed.

Q `You never mention oil companies. Are you confident that American oil producers are tapping all of the sources they have out there, including offshore?

THE PRESIDENT: What about them — do I think they’re investing capital to find more reserves with the price at $140 a barrel? Absolutely. Take an offshore exploration company. First of all, it costs a lot of money to buy the lease, so they tie up capital. Secondly, it takes a lot of money to do the geophysics, to determine what the structure may or may not look like. That ties up capital. Then they put the rig out there. Now, first of all, in a federal offshore lease, if you’re not exploring within a set period of time, you lose your bonus; you lose the amount of money that you paid to get the lease in the first place.

And once you explore, your first exploratory, if you happen to find oil or gas, it is — you’ll find yourself in a position where a lot of capital is tied up. And it becomes in your interest, your economic interest, to continue to explore so as to reduce the capital costs of the project on a per-barrel basis. And so I — I think — I think they’re exploring. And hopefully a lot of people continue to explore so that the supply of oil worldwide increases relative to demand.

theClassicLib: Are oil companies investing in oil exploration?  LOL!  That’s what they do! That’s their business!  I’m sorry, but whoever the journalist is that asked this question, isn’t even bright enough to ask questions of the local class C softball team, let alone the President of the United States of America.

Yet … The Mainstream Media can’t figure out why their losing money and market share … um, uh … well … maybe it has a lot to do with insulting your customers intelligence with such ridiculous questions.


A Billion

A Billion DollarsWe all receive emails full of nonsensical stuff that friends and co-workers insist on passing around.  Generally I skim them very fast and delete, however, once in a blue moon, one of these “chain” emails catches my eye with some interesting content.  Today I share one of these emails with you.

The next time you hear a Politician talking about spending BILLIONS of TAX dollars, think about how much money that really is.  As inflation pushes the price up on everything around us, think about how handy the 30%+ the government CONFISCATES from each of your paychecks would be.  Then … think about how far IN DEBT the Politicians have put the government.  And when you’re done, go look yourself in the mirror and ask why you would ever trust one of these snake-oil salesmen (or women) again.

Here’s the email:

The next time you hear a politician use the word ‘billion’ in a casual manner, think about whether you want the ‘politicians’ spending YOUR tax money.

A billion is a difficult number to comprehend, but one advertising agency did a good job of putting that figure into some perspective in one of it’s releases.

  1. A billion seconds ago it was 1959.
  2. A billion minutes ago Jesus was alive.
  3. A billion hours ago our ancestors were living in the Stone Age.
  4. A billion days ago no-one walked on the earth on two feet.
  5. A billion dollars ago was only 8 hours and 20 minutes, at the rate our government is spending it.

While this thought is still fresh in our brain… let’s take a look at New Orleans.  It’s amazing what you can learn with some simple division.

Louisiana Senator, Mary Landrieu (D) is presently asking Congress for 250 BILLION DOLLARS to rebuild New Orleans.

Interesting number … what does it mean?

Well… if you are one of the 484,674 residents of New Orleans (every man, woman, and child) you each get $516,528.

Or… if you have one of the 188,251 homes in New Orleans, your home gets $1,329,787.

Or… if you are a family of four, your family gets $2,066,012.

Washington, D.C. HELLO! Are all your calculators broken???

Accounts Receivable Tax

Building Permit Tax

CDL License Tax

Cigarette Tax

Corporate Income Tax

Dog License Tax

Federal Income Tax

Federal Unemployment Tax (FUTA)

Fishing License Tax

Food License Tax

Fuel Permit Tax

Gasoline Tax

Hunting License Tax

Inheritance Tax

Inventory Tax

IRS Interest Charges (tax on top of tax)

IRS Penalties (tax on top of tax)

Liquor Tax

Luxury Tax

Marriage License Tax

Medicare Tax

Property Tax

Real Estate Tax

Service charge taxes

Social Security Tax

Road Usage Tax (Truckers)

Sales Taxes

Recreational Vehicle Tax

School Tax

State Income Tax

State Unemployment Tax (SUTA)

Telephone Federal Excise Tax

Telephone Federal Universal Service Fee Tax

Telephone Federal, State and Local Surcharge Tax

Telephone Minimum Usage Surcharge Tax

Telephone Recurring and Non-recurring Charges Tax

Telephone State and Local Tax

Telephone Usage Charge Tax

Utility Tax

Vehicle License Registration Tax

Vehicle Sales Tax

Watercraft Registration Tax

Well Permit Tax

Workers Compensation Tax


Not one of these taxes existed 100 years ago, and our nation was the most prosperous in the world.

We had absolutely no national debt.

We had the largest middle class in the world.

and … Mom could stay home to raise the kids.

What happened?

Can you spell ‘Politicians!


The Elephant in the Room

exfordyOr should I say in the rear view mirror? Because no matter how fast they try to run, it’s coming … and it ain’t gonna be pretty.

As the three leading candidates McCain, Obama, and Clinton continue to campaign on, promising anything and everything to everyone… there’s an elephant in the room, and not only do they refuse to talk about it, nobody in the media even bothers to ask.

Meet Mr. Elephant, his name is Social Security.

Yeah, once and awhile, a politician brings up Social Security, but mostly they just hang their hat on the mythical year 2017. This is the year they believe Social Security will simply tap into the trust fund and keep paying out those benefits. From there, they would have you believe the “money” in the “trust fund” will carry us until somewhere in the neighborhood of 2042. Well, I’ve got news for you: Either they’re selling us a bunch of snake oil, or they’re too naive to understand the truth. In either case, they then shouldn’t be in office at all.

A trust fund is real property – money, securities, real estate, etc. – held “in trust” by one party (the trustee) for the benefit of another (the beneficiary). The problem with Social Security… is that there is no real property in the Social Security Trust Fund, and there NEVER HAS BEEN!

The Social Security Trust Fund is nothing but an accounting gimmick. Here’s how it works: Workers and employers pay social security taxes to the government. The Treasury receives this money and credits the Social Security Trust Fund with that amount. It then pays out benefits to current beneficiary’s, and subtracts these payouts from the account. All monies remaining in the “trust fund” is then immediately SPENT on other government expenditures. NO MONEY goes into the “trust fund”. Instead, the “trust fund” ledger gets IOU credits for the amount of Social Security receipts used to pay for the general budget. The Treasury then “pays interest” on these IOUs by crediting the “trust fund” account with additional IOUs making the “trust fund” appear to grow. No money ever changes hands, this is done only in an accounting ledger.

If this sounds like an Enron shell corporation to you, that’s because it is!

According to the Congressional Research Service on May 5, 1998:

When the government issues a bond to one of its own accounts, it hasn’t purchased anything or established a claim against another entity or person. It is simply creating a form of IOU from one of its accounts to another.

And the Office of Management and Budget in 1999:

These [trust fund] balances are available to finance future benefit payments and other trust fund expenditures–but only in a bookkeeping sense. These funds are not set up to be pension funds, like the funds of private pension plans. They do not consist of real economic assets that can be drawn down in the future to fund benefits. (emphasis added by me)

What does this mean?

It means that when these “trust fund” IOUs are “redeemed”, they will have to be paid for by raising taxes, reducing benefits, borrowing from the public, and/or cutting other government expenditures.

Now stop and think with me for a moment. Let’s use our imagination and pretend. Let’s pretend that there isn’t a Social Security Trust Fund. Let’s pretend for a moment that it never existed. Okay? You with me? Now, when the time comes that social security receipts are not enough to pay current beneficiary’s, what would we have to do to keep paying out everyone’s full benefits? (Remember, we’re pretending the “trust fund” doesn’t exist.)

Exactly! We’d have to raise taxes, reduce benefits, borrow from the public, and/or cut other government expenditures. The SAME THING that would have to be done IF there really was a “trust fund”!

This is a financial disaster waiting to happen. A disaster like this country’s never seen. The first “baby boomer” has already retired, and the benefits being paid out are increasing at a record rate. The governments rosy projection is that current receipts will cover current expenditures through the year 2017, but we all know about government “projections”. You and I both know the local weatherman is more accurate then they’ve ever been. My best guess is that current receipts are lower than benefits paid out by year 2012.

The bottom line is this: The politicians have been LYING to the public in claiming that Social Security is solvent through year 2042 or more. And the longer this problem keeps being swept under the rug, the worse this impending CRISES will become.