I Did That

This is a deeds world. Actions matter. Talk is, well, just talk. Our fearless leader, President Joe Biden, has on multiple occasions claimed to be doing everything possible to minimize price inflation. In his State of the Union address he said:

"My top priority is getting prices under control”

Today’s blog will consider this administration's handling of the rising gasoline prices, as they are something to which everyone can relate. Our president acknowledged the following at his March 31st press conference:

"Look, I know gas prices are painful. I get it. My plan is going to help ease that pain today..."

His words indicate he is aware of the problem and doing everything possible to fix it.

Now let's see if his deeds match his words .....

In his first week in office, President Biden signed an executive order suspending new oil and gas leases on ALL federal lands. With the swipe of a pen, he stopped any and all new permits to drill for oil and gas. If you take Biden at his word, and genuinely believe he intends to do what he can to lower gasoline prices, how exactly does preventing new supply from coming on to the market lead to lower prices?

In his first month in office, he permanently shut down the keystone pipeline. Once again, preventing new supply from coming into the market, this time from our neighbor to the north (Canada). Bagholder wonders, is there no one in this administration who can explain to the President restricting supply pushes prices higher?

Just two months ago, the President decided to further restrict supply by sanctioning Russia, the world’s second-largest exporter of Oil & Gas. There has been NO effort on the part of this administration to even sit down at the negotiation table and find a middle ground with Russia. Rather than bring Russia's oil back onto the market by lifting sanctions and saving lives by finding a peaceful end to the war, Biden's bigger priority is to saddle the American Public (and our European allies) with less supply in an already tight market.

Today (March 12th), the Biden administration canceled existing leases in both the Gulf of Mexico and Alaska. It wasn't enough for Biden to suspend all NEW leases in those areas. No. He has now decided not to renew existing leases as well. The price of gasoline at the pump has nearly tripled since Biden entered the White House, and once again, he chooses to further prevent supply from coming on to the market.

Not to be outdone by President Biden, Nancy Pelosi & her fellow house democrats have introduced the 'Consumer Fuel Price Gouging Prevention Act' that will give the President the power to issue an Energy Emergency Declaration that would make it unlawful to increase gasoline and home energy fuel prices in an excessive or exploitative manner. For those not fluent in Political Bullshit, allow me to translate the last sentence. Our politicians are going to combat higher prices with "Price controls”. If any of you reading this, can point to any example in the history of the planet where Government price controls lowered the price of anything, Bagholder will kiss every cow's ass in Texas.

To be fair, we have only considered the supply side, of supply & demand. Let's think for a moment about what Biden's actions are doing to the demand side of things. For starters, shutting down the keystone pipeline which ran from Canada all the way to our refineries in New Orleans & Houston, means those refineries will require the oil they refine, to be trucked in by Semis. How much gas/oil do you suppose those 18 wheel semis will burn (not to mention pollute) hauling the crude oil 1700 miles down to our refineries?

Perhaps the biggest user of oil/gas is the US military. With Biden's refusal to even attempt to negotiate a peaceful settlement, our military is busy flying supplies of all kinds over to the Ukraine in order to bog down Russia in a protracted war. The military demand (which would not exist with a peaceful resolution) for existing oil supply will be filled first, long before the demand of your corner gas station. Not only has our military increased demand for oil, but the Russian military has as well. That is just one of the many costs of war.

Biden claims the rising gas prices are the evil machinations of Vladimir Putin. “Putin is to blame” Biden says. Dismissing Biden’s words and looking at his deeds exposes the real culprit for soaring gas prices. Halting all new drilling permits, closing down pipelines, sanctioning oil exporters, instituting price controls, and not renewing existing leases are ALL Biden deeds currently crimping supply. At the same time, his decisions to protract the war by arming the Ukraine and forcing crude to be trucked into refineries is goosing demand.

Any 10th grade high school kid in an economics class could tell you with authority, when you restrict supply AND increase demand, the result is higher prices. So when President Biden & his fellow democrats tell you they should not be blamed for soaring prices, and that they are doing everything in their power to lower prices...either they are lying through their teeth, or they lack the economics understanding of your typical high school sophomore. My guess is both.