Citizens Against Taxing Big Oil

You can fool some of the people all of the time, and all of the people some of the time, but you can not fool all of the people all of the time. – (attributed to) Abraham Lincoln

One evening I was watching the news minding my own business when I was astonished by what I saw. It was an ad paid for and produced by the American Petroleum Institute or API. API is the main trade association for the oil and natural gas industry. According to the commercial which depicted what appeared to be ordinary Americans upset because the Congress is considering raising the taxes on the industry by 80 billion dollars in the 2011 budget. According to these ordinary Americans raising taxes during a recession on anyone is bad policy. This rationale sounds eerily familiar to the rhetoric being used to justify keeping the Bush tax cuts. It is this type of blatant propaganda that must be exposed for what it is.

What is amazing to me is that we have all read how energy company profits have been at all-time highs for the last decade. Each quarter they set new record highs not just for energy companies but for all corporations. So with all of these record profits you would think that these concerned energy titans would be using that money to research and develop new cleaner energy technologies right? Wrong. Many of these companies are using less than 1% of their income to research new clean energy technologies. Most of them are using these enormous profits to buy back their stock and thus insuring even larger profits in the future. So at the end of this decade of record profits we are to assume that taxing these companies is going to wreck the economy and kill 400,000 jobs?

We as Americans through the work of our political leaders have been subsidizing an industry that continues to make money hand over fist. We do this not only in paying higher energy bills but also through subsidies to this industry.

All of this political gamesmanship aside, consumers have good reason to be angry. Not only are the oil companies racking up extraordinary profits, they’re doing it while continuing to enjoy generous tax breaks and economic subsidies paid for by the same people who are also paying exceptionally high prices at the pump. Essentially, consumers end up paying oil companies twice for the same product, first subsidizing their production and then buying the finished product at inflated prices. – Larry West

So let me get this straight, the people who are being gouged are upset because the people who are gouging them are going to have pay taxes on these record profits and lose some of the subsidies they don’t need in the first place. How stupid do they take us for? I thought the ad about an energy company being in the people business was bad, but this one sets a new low. The thing that troubles me the most about this ad is that the people being interviewed obviously have no clue who the tax would impact. One woman states that some people are barely hanging on so raising taxes would be a burden. I agree if the tax was for ordinary working people but this tax is on an industry where the top 5 companies made over 550 billion dollars under the Bush administration and has not slowed down since. Are we to assume that the oil industry is just barely hanging on? If it weren’t so dishonest it would be almost comical.

We as a nation I believe will not get serious about clean energy until we make it too painful to continue down the path we are on. Unfortunately humans respond best to two stimuli; pain and fear. Most of the countries that are pioneering clean energy and sustainability are doing so because they had to. Until gas prices reach about $5 a gallon we will continue our urban sprawl with bigger and more congested highways, we will continue to refuse to develop and implement clean energy sources for providing energy to our homes and businesses, and we will ignore rail and other transportation alternatives. The truth is that gas prices will reach $5 the question then becomes do we allow the profits to go to an industry that has repeatedly shown it has no desire to provide clean sustainable energy or do we create a self-imposed tax that will be used to fund the switch to clean energy? How can we expect an industry with little or no incentive to develop the clean energy technologies we need?

Following the oil embargo of 1973 the nation of Iceland embarked on a radical and massive shift in its energy policy. Because the cost of fuel had skyrocketed they made the calculated determination that they would begin to seek alternative fuel sources and conservation. The people of Iceland created a self-imposed tax on oil to fund their transformation to renewable energy and today are reaping the benefits. So while we went left (change suppliers), they went right (reducing dependency and alternative sources). So while they now enjoy the freedom of renewable energy we are still being held hostage by foreign governments (many of whom are hostile to us) through our big oil companies. History has shown us that we will not develop sustainable energy policy until the last drop of oil is gone. The problem with that strategy is by that time it will be too late.

The use of solar energy has not been opened up because the oil industry does not own the sun. - Ralph Nader

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Enough Is Enough

If I hear or read about another billionaire claiming that the current economic woes we are suffering as a nation is due to our “entitlement” programs, I am going to scream. The latest in the long line of billionaire apologist is Pete Peterson. Mr. Peterson, is a longtime opponent of Social Security, Medicaid, and any other government programs targeted to help the needy, who appeared on Charlie Rose. According to Mr. Peterson it is not greed and speculation that has reeked havoc on our economy for the past 30 years, it is the entitlement programs. All this time I have been thinking that not being able to know when you’ve had enough is the problem. Come to find out I am looking in the wrong direction. Greed has been around for a long time, entitlements have not. The Crash and the Depression occurred prior to entitlements; I wonder who Mr. Peterson blames those on.

I believe the Social Security Trust Fund belongs in the first tier of classic oxymorons. In the first place, the Social Security Trust Fund should not be trusted, and it is not funded. We anesthetize the public with highly reassuring long-term statements that the trust funds are solvent for decades. Yet, we do not tell the public that the payroll taxes of our children and grandchildren would have to double to cover the costs of Social Security and Medicare. That is an unthinkable burden. We do not tell the public that whether you have a trust fund or not, you still face the same three hard choices: increased taxes, cut benefits, or try to borrow unprecedented amounts.

Now how much would we have to borrow? I think it’s time we started thinking in cash flow terms, because these programs are obviously pay-as-you-go programs. The projected cash flow deficits for Social Security and Medicare go from a modest $25 billion in 2003, to a projected $783 billion in 2020, and trillions of dollars thereafter.[1]

These statements on the surface seem reasonable enough, we have not done a good job funding and fixing the entitlement programs. Instead of facing some tough realities and questions the politicians have continued to ignore them, afraid of providing the American public the ugly truth, ugly truths do not win elections. The problem I have with these guys is they present the picture as though the entitlements were the only item in the budget. So rather than saying it is a matter of priorities they present the picture as a zero-sum game. Nowhere do they mention the military budget, the tax-cuts, or the other government programs that make up the complete budget. We are left to believe that the entitlements exist on some island, isolated from the other expenditures.

Mr. Peterson discussed the Prescription Drug benefit that was added to Medicaid as an example of making a bad situation worse. I agree, but he doesn’t mention that he is a Republican and it was the Republicans who created the Bill that forbid the Government from negotiating prices for the prescriptions. I wish just once these guys would take responsibility for the messes they make. The Republicans built in astronomical profits for the benefit of the big pharmaceuticals, just as they did for big oil who is recording unprecedented profits. Nowhere does he mention the billions of dollars that were made during the mortgage meltdown by those same companies who are now crying bankruptcy. Is it me or did billions of dollars just disappear into thin air? Someone had to profit from all of those loans, why is this information never debated? Nor, did he mention that it is the Republicans who are trying to bankrupt the system to force its collapse.

Mr. Peterson stated that he supports John McCain and was asked about Senator McCain’s flop on the tax-cuts, he presented the standard line that what McCain was against was not tax-cuts per se but tax-cuts without spending cuts. McCain and his supporters are backpedaling so fast from statements like the following it blows the mind:

“Mr. President, the principle that guides my judgment of a tax reconciliation bill is tax relief for those who need it the most—lower- and middle-income working families. I am in favor of a tax cut, but a responsible one that provides significant tax relief for lower- and middle-income families. And I commend Sen. Grassley for moving in that direction. But I am concerned that debt will overwhelm many American households. That is why tax relief should be targeted to middle-income Americans. The more fortunate among us have less concern about debt. It is the parents struggling to make ends meet who are most in need of tax relief.

“I had expressed hope that when the reconciliation bill was reported out of the Senate Finance Committee, the tax cuts outlined would provide more tax relief to working, middle-income Americans. However, I am disappointed that the Senate Finance Committee preferred instead to cut the top tax rate of 39.6% to 36%, thereby granting generous tax relief to the wealthiest individuals of our country at the expense of lower- and middle-income American taxpayers.”[2]

Senator McCain and Mr. Peterson have no problem today with the Feds bailing out Bear Sterns and the Wall Streeters, it is the average American who Senator McCain was concerned about in 2001 who don’t deserve any relief. Mr. Peterson said that while it was a dangerous precedence, he supported the bail-out to stem broader market drops. You have to love this line of, “we hate to do it and we know its bad business, but we have to. He gave the same excuse for all of the liquidity funds they have received from China. He didn’t seem to have any problem with China owning large sections of our banking industry. I’m no Nobel economist but even I know that can’t be a good idea.

Oh, by the way Mr. Peterson is making a donation of a billion dollars to help teach Americans how to save. First of all, how rich do you have to be to give away a billion dollars? Secondly, what he failed to mention is why the American family is in the situation it finds itself. Due to flat wage pressure being exerted by Mr. Peterson and his billionaire friends for the past 30 years, the wife has had to go to work to increase household buying power. After that money was spent, they began mortgaging their homes and running up credit card bills for expense money. Now that they have spent that money the well is now dry. And Mr. Peterson says if they had just saved money the economy wouldn’t be in this predicament. He wants consumers in a consumer economy to not consume or reduce consumption. That horse is already out of the barn, we have been bombarded since the age of television to buy. Where were the commercials for saving money?

[1] http://petersoninstitute.org/publications/papers/peterson0804.pdf
[2] —Senate floor statement during debate over President Bush’s tax relief package, May 21, 2001.

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Bush And The Gas Bubble

Why is the price of gas so high? Why is crude oil trading at all-time highs? It seems like everyday we set a new record price for crude oil. Has there been an outbreak of another war in the Middle-East that I have missed? What I have learned is that the price of gas and the record crude oil prices have nothing to do with reality. The truth is that all those rich speculators and hedge fund managers that caused the mortgage crisis have now when that bubble has burst moved their money from the stock markets to commodities. That’s right with the market taking a beating from the credit mess the “smart money” has moved to oil speculation.

According to the statement from OPEC, the global market is "well-supplied, with current commercial oil stocks standing above their five-year average." Today's prices don't reflect market fundamentals, OPEC said, but the weakness of the dollar, rising inflation and the "significant flow of funds into the commodities market."[1]

So if there is not a shortage of oil why am I paying through the nose for gas? The problem is two fold. First there is greater consumption in the world, so what was enough five years ago is not enough today. With the addition of China and India wanting to fuel their industrial revolutions the reserves are not going as far as they use to. Of course you also have the US marketing and buying SUV’s and “crossovers” like there is no tomorrow. I’m sorry I need some help on this one, we have been aware of the problems of dependency on oil and other non-renewable fuels since the 70’s and yet here it is in 2008 and instead of having vehicles that use less fuel we have the biggest vehicles in our history. Newsflash – Crossover vehicles are not smaller fuel efficient SUV’s, they are giant station wagons.

Not exactly. None of this price run-up could be possible without the unbridled consumption of oil in the United States, by far the largest oil user, and the soaring consumption of rising economies such as China and India. Increasing political tensions make shortages a possibility, and markets factor in that risk, which drives prices higher.

"I think the biggest problem is pure fear. Right now there is no supply problem," said David Wyss, chief economist for the New York rating agency Standard & Poor's. "What happens if Venezuela goes to war in Colombia? What happens if various crises in Nigeria get loose? Iran is always making noises."

Fearing the potential for shortages, investors are willing to pay a premium.

"They're not buying oil, they're buying insurance," Wyss said.[2]

Now we are forced to go hat in hand to the Saudis and other oil producers to beg for an increase in production in the hope that this will reduce prices. The second problem is that it isn’t just about production, it is about our oil policy. It is about an oil policy that rewards the big oil companies with tax incentives to continue to buy foreign oil while we spend nothing on research for renewable sources and reduction in consumption. Our energy policy eerily resembles our drug policy, instead of trying to stem consumption we spend billions of dollars to eradicate the problem in the countries where it isn’t a problem. The Saudis do not have an energy problem, we do. So while President Bush wants to continue giving his big oil friends and family tax breaks our economy rapidly approaches meltdown. And all the while we hasten the process by purchasing vehicles that don’t meet our needs but instead meet our egos.

There is no oil shortage. What there is a shortage of is common sense and willpower. I recently saw a commercial from one of the big oil companies promoting how they are now part of the solution to our energy needs. Whenever corporate profits exceed any justifiable limit they immediately roll-out these PR ads stating how they are using all of these ungodly profits not to benefit the corporate elite, but average Joes like you and me. I sleep better already just knowing that big oil is working to create renewable energy sources that will conceivably put them out of business. Remember, ignore the man behind the curtain and focus on the great Oz. The greedy see an opportunity to enrich themselves again with commodities so don’t be surprised if the price of oil is not the only thing that rises. All of which will continue to put inflationary pressure on our economy and push us closer to the brink.

Instead of having regulatory agencies that protect the consumers from this type of speculation we have “free market” forces that for some strange reason are only good when they favor the wealthy. Why aren’t free markets good for all products? Why are we subsidizing commodities like produce, oil, and sugar? The truth is that we continue to subsidize these markets because our politicians have been bought and sold like so many bushels of corn and will continue to allow industries to write their own legislation and regulate themselves and in the end we will all suffer. We will continue to have to choose between gas and food or gas and medicine. Isn’t free enterprise wonderful? This bubble will eventually burst just like the previous ones, but in the process many families are going to be hurting and that will be the real tragedy.

[1] http://www.mcclatchydc.com/homepage/story/29586.html
[2] Ibid

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Bush Offers Little More Than GasX For Gas Woes

With price of crude oil hitting the $90 a barrel mark, one would think that the President of the country that uses the most petroleum would be a little concerned. However, true to his natural lack of concern for anything not related to the wealthy, Mr. Bush came out with the following forceful statement in defense of the middle-class. The stock market tanked on the news, so it appears that investors considered it a bit more significant than the White House. There are millions of Americans who are suffering under the stress of high energy costs and with winter around the corner there will be millions more. The rise in crude oil prices will fuel the rise in many other products forcing many families to have to make some tough choices this winter.

WASHINGTON (AP) -- With crude oil prices crossing $90 a barrel, the White House said Friday that President Bush would like to see prices lower.

At the same time, the White House played down the $90 mark. ''There's no magic to any particular number like $90 a barrel, but obviously we would prefer oil prices lower,'' said deputy press secretary Tony Fratto.

''The president certainly would like to see the price of oil lower and would like to see us rely less on foreign sources of oil and reduce our dependence on all forms of oil,'' Fratto said. He called on Congress to enact Bush's program to expand the use of alternative fuels and cut gasoline use by 20 percent in 10 years.[1]

The problem I have with this White House, Republicans, and George Bush in particular is their dismissive attitude towards the general public. It’s as if they are saying, “We know what is going on and you don’t, so don’t ask us any questions or question any of our policies”. They continue to live in their own false reality to where crude oil prices reaching new highs means nothing, because they say it means nothing. Who are you going to believe this administration or your freezing kids? This of course is in keeping with his forceful remarks on the mortgage crisis.

We need a President who is willing to lead in times of crisis, a President who is willing to do more than lead us into war. We need a President who will provide direction and leadership and not just the same old rhetoric. Mr. Bush is showing every day that he is in fact irrelevant despite his calls to the opposite. Rather than using his remaining time in office to provide leadership in a worsening economic crisis, he chooses to desert the average American and continue to stand firm with his wealthy friends.

Ninety dollars a barrel may not be a magic number for this administration, but it is a magic number for the majority of Americans who have to buy gas and fuel oil this winter. We need more than a President who wants to placate us, we need one who will do more than say he would like to see lower prices. Hell, I would like to see a bigger paycheck, but saying it won’t make it so. This President needs to do more to help the average American during these economic times. The economy currently is only benefiting those wealthy few who have already received the tax-cut give-away that was suppose to stimulate the economy. It turns out it was just another transfer of wealth from the middle income Americans to the wealthiest. When will Americans realize that giving money to the wealthy will never result in economic success for them, all it does is give more wealth to the wealthy at tax payer expense.

The income to the government must be paid and if the wealthiest are getting tax-cuts, who do you think is paying for it. So rather than being able to provide health care for our poor children, or mortgage relief to average Americans, or fuel relief, we have a public treasury that has been bankrupted by the wealthy looters. It is going to be a long cold winter for Middle America. After struggling through the high fuel prices of summer, it will be more of the same for winter.

Have these guys gotten anything right on Iraq? Where is the lower fuel prices we were suppose to see in exchange for our securing their freedom? Along with all the other Iraqi scenarios, this one proves to be just as false. So let’s break out the GasX, because I have a feeling we are going to need it.

[1] http://www.nytimes.com/aponline/us/AP-Bush-Oil.html

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Mister, “Can you spare a gallon?”

It seems like every year at this time we go through the same gas shortage/high prices phenomenon. This has been going on since I first started driving in 1976, I started late! Did I miss something? I know I am not very smart and don’t claim to be, but why has this problem not been adequately dealt with in 30 years? Why have we allowed the big oil companies to year after year present this same lame excuse for price gouging? Why have our elected officials not been able to or been unwilling to tackle this national problem?

I was in Chicago over the weekend and gas prices were 4.00@gallon. Is it just me or does that seem inordinately high? If every year the oil companies know there will be a larger demand in the summer, why do they not make allowances for this? Can it really be as simple as it is being reported by the media for why gas is so high? I have never been one to accept the status quo so after a little investigating this is what I found out.

There's no doubt that the recent refining share has gone higher, although the share has been higher in the past. (Note: With a higher gasoline price, the spread in dollars is going to be higher even with a constant share.) A quick glance reveals obvious seasonality in the refiner's share. To get a feel for how we stand relative to the same time in previous years, Figure 4 presents the refiner's share over the current and past three years.

Figure 4: Share of gasoline prices associated with refining, in 2007 (blue), in 2006 (red), in 2005 (green), in 2004 (black), in percent. Source: Energy Information Administration.

The graph confirms the impression that the refiner's share has been particularly high for this time of the year, although there have been higher peaks, specifically in 2004.

One bit of policy analysis. The Washington Post article quotes the assertion that the wide spreads are due to policy inaction over the past six years. There is indeed a temptation to ascribe the wide spreads to cartelization, or opportunistic shutdowns of refineries (and I won't rule either of those out -- remember Enron and California in '00-'01...). However, high spreads are also consistent with the view that there is no coordinated reduction of supply and the view that if conservation had been encouraged over the past six years (instead of tax breaks for SUVs), the spread would be smaller. That's because theory predicts that the greater and more inelastic the demand, the greater the resulting price-cost margin.

So one way of thinking about what policies could have mitigated the crack spread is to consider both demand management and supply enhancement. The Administration until recently focused almost solely on the latter.[1]

Basically what is happening is that the oil companies which not only import oil, they also refine the oil, and then they sell the gasoline that is refined from the oil are always looking for ways to increase profit margin. The profit margin in the actual price of crude oil is pretty much stagnant; it is built into whatever the market will bear. All oil companies pay about the same price for crude so there isn’t a lot of room for individual price change, except on a conspiratorial cartel level which the author seems to brush off with little desire to explore. As usual we fell to grasp the obvious in our search for some far fetched analysis of why things are the way they are. The answer is usually something simple; in this case it is; big oil companies wanting to maximize profits at the expense of a captive consumer. It is a known fact that even with gas prices spiraling; demand has not diminished and it does not diminish due to what we drive and how we drive.

I have never understood why no one has ever investigated the link between the American auto industry and big oil. Is it just a coincidence that when the price of gas is at an all-time high the most popular vehicles are SUV’s and other large vehicles? We must not fall for the old scam of “it is a consumer driven market”, the consumer will buy what is presented to them. If there were no SUV’s would consumers demand them? I find it interesting that we have an energy policy that does not deal with two of the most important components of the issue. The fact that we have been sold vehicles that are energy inefficient and that our gas policy is being set by a few giant energy conglomerates. It doesn’t seem to matter who is in power or who is in office, the oil companies keep making money. And we the consumer, keep filling the coffers of those companies despite the hardships it is causing.

The rise in prices is hurting working class and lower-income families the most, as they have less disposable income to shift to transportation costs. This means that the high prices are cutting into other necessary spending, including food, prices for which are also rising throughout the country. An AP poll released May 25 found that 46 percent of the population said that high gasoline prices are causing severe financial problems.

The shortage of refining capacity is generally attributed in the media to a number of planned and unplanned refinery outages. However, refinery capacity has been deliberately decreased over the course of the past two decades, for the explicit purpose of boosting profit margins.

The Journal article notes, “For decades, there was too much refining capacity in the US, margins were crummy and many companies were closing or selling off refineries. In 1986, refiners made little more than $2 for every barrel they processed.” The newspaper quotes Fadel Gheit, a senior energy analyst of Oppenheimer & Co. and a former employee at Mobil, now part of ExxonMobil, as saying, “We used to commission studies to get rid of refineries. We wanted to give them away.”

In the first quarter of the year, refining profits of $1.91 billion at Exxon and $1.62 billion at Chevron have helped generate massive profits for the companies as a whole. Corporations that engage only in refining have done even better.

In the long-term, the high gasoline prices are a product of the conscious policy of the giant oil companies, who, through a series of mergers and acquisitions over the same period, have concentrated the market in the hands of a small number of firms. Inflation-adjusted prices for gasoline in the US were below $2.00 a gallon for most of the late 1980s and 1990s. They only surged above $2.00 in 2004, and have pushed past $3.00 for periods of time in 2005, 2006 and again in 2007.

The ability of energy companies to increase profits simply by raising prices is aided by the fact that demand for gasoline, particularly in the United States, is highly inelastic—i.e., demand does not fluctuate much with changing prices. This is due to the fact that there are few alternatives to automobile transportation, given the absence of viable public transportation systems in many areas. In major metropolitan areas such as Los Angeles or Detroit workers have no choice but to drive the often long distances separating homes from work. According to the Census Bureau, only 4.7 percent of the US commuting population takes mass transit to work each day.[2]

It appears that the biggest surge in prices have come under the President with ties to big oil. Am I the only one who finds this disheartening? When will we as Americans stop supporting those who do not share our best interest?

NEWSFLASH – There are other issues in this country besides abortion and gay marriage. While these issues are important to a great many people and I would never attempt to minimize them, we also have to look at the big picture. While the powerful are pushing these “hot button” issues they are stealing the country blind. The sad fact is that these people will not abide by or be affected by whatever the outcome of these will be in court or public opinion. They don’t care if abortion is illegal or legal, if they need to have one they will get one. So while average Joe and Jane are picketing and voting in these corporate and wealthy stooges, the rich keep right on getting richer. These people could care less about the average person; there only loyalty is to money. It is not to race, creed, or color; unless the color is green. They will make money off of anybody or anything. Just think about all those things that were once considered “ethnic” and how they are now being used to sell everything from luxury sedans to diapers.

What is clear is that the rise in prices cannot be explained by a corresponding rise in crude, since crude prices have remained largely flat over the period that gasoline prices have soared.

Several commentators, including the WSWS, noted the coincidence last year between a sharp decline in the gasoline prices and the run-up to the 2006 mid-term elections. According to polls conducted at the time, 42 percent of the American population held the opinion that the price drop was part of a deliberate attempt to manipulate the elections by temporarily decreasing economic insecurity. This was seen as a potential boost to Republican candidates. (See “US gasoline prices; the ‘free market’ and the November elections”)

With the soaring gas prices, the energy companies are now getting back every penny, with interest, that they lost while prices were relatively low in September, October and November.

Even if one were to suppose that there was no element of deliberate manipulation, the situation stands as an indictment of the anarchistic character of the capitalist market, particularly evident in the fluctuations in the prices of basic necessities such as gasoline. An energy policy developed to serve the interests of the population, and not the profits of a handful of energy giants, would involve ensuring an adequate supply and low prices, not to mention substantial investment in public transportation infrastructure. The subordination of the energy market to the demands of profit has also made it impossible to pursue rational energy policy on such issues as global warming.

Under these conditions, the various proposals advanced by the Democrats in Washington are noteworthy only for their cynicism. The House of Representatives passed a bill that would punish anyone found guilty of engaging in price gouging. Others have suggested measures—the same ones suggested and never passed whenever gasoline prices spike—that would temporarily cut federal taxes or create a “windfall profits” tax. Leading Democrats raise these proposals knowing full well they will never pass into law. However, even if they did, they would have no impact on the underlying problem—the domination of a handful of energy companies over a market that affects hundreds of millions of people.[3]

The interesting thing here is that even if we were naïve enough to believe that there were no price gouging, just the fact that one of our most basic needs is being manipulated by such a small group. Just as we have public energy commissions for our other energy concerns, why do we not have one for gasoline? Let the oil companies justify their rate hikes before a group of citizens who are not on the payroll. We should be tired of the same old tricks, where the Democrats hold hearings and protest before the cameras only to leave the thing still broke. They get some mileage from beating up “big oil” and still get to keep their contributions. Is this a great country or what?

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[1] http://www.econbrowser.com/archives/2007/05/gasoline_prices_3.html

[2] http://www.wsws.org/articles/2007/may2007/gaso-m31.shtml

[3] Ibid

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It Wasn’t About The Oil

A White House spokesman, Tony Fratto, said Bush expressed confidence in al-Maliki during a telephone call Monday to the Iraqi leader.

He said the two talked about political progress in Iraq, and al-Maliki gave Bush updates on two key U.S. demands -- legislation to share Iraq's oil wealth among its regions and ethnic groups and a reform of the constitution.

But two senior Iraqi officials told The Associated Press that Bush warned al-Maliki that Washington expected to see "tangible results quickly" on the oil bill and other legislation as the price for continued support.

Senior Kurdish lawmaker Mahmoud Othman confirmed that U.S. pressure was mounting, especially on the oil bill, which was endorsed by the Iraqi Cabinet three months ago but has yet to come to the floor of parliament.

"The Americans are pressuring us to accept the oil law. Their pressure is very strong. They want to show Congress that they have done something so they want the law to be adopted this month. This interference is negative and will have consequences," Othman told AP.[1]

News flash; If the Iraqis want America out of Iraq, then don’t sign the oil bill. It appears that the only way to get Bush to put pressure on the Iraqis is concerning the oil. Based on news out of Iraq the majority of the Iraqi parliament members want a time line for withdrawal of American troops. There seems to be hesitation on signing the PSA agreements by the Parliament as well. The administration wants us to believe the reason for the rush on the oil bill, is to alleviate fears among the Sunni’s of being impoverished in the new Iraq. The real reason of course is they want to lock the Iraqis into these long term PSA’s which heavily favor the large oil companies while the Iraqis are in a position of weakness.

With Iraq going to hell, the focus of this administration is not on reducing the suffering; it is on increasing the profits.

“The Democrats were elected in November to lead the country out of the war, and this bill doesn’t do that,” Mr. Pariser said. “And the perplexing thing about this moment is that the Democrats have the political wind strongly at their backs, and the country wants them to fight.”

Many Democrats share that view, saying they would have preferred a harder line from the leadership. “They were weaker than I would have preferred,” said Representative Jerrold Nadler, Democrat of New York.

But some of Mr. Nadler’s colleagues said Democrats had to exhibit the responsibility that came with power and should reserve their criticism for Mr. Bush. [2]

Many in the party are disappointed with the leadership and with good reason. If the American people supported this war they would have left the Republicans in office. When are these apologists going to learn that there has to be more to governing than criticizing George Bush.

I am of the belief that there are more than a few Democrats that would have us continue down this bloody path in Iraq for political gains. I am sure someone believes that as long as we are in Iraq and as long as it continues to go badly, it won’t matter who the Republicans nominate. I hope that I am wrong and that concern for our troops would overcome politics, but with the this White House and this Congress who knows. Let’s make “We Support The Troops” more than just a bumper sticker. Let’s start by bringing a few of them home alive.

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[1] http://www.stltoday.com/stltoday/news/stories.nsf/world/

[2] http://www.nytimes.com/2007/05/24/washington/24cong.html

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When will it end?

Why is it that the administration can not acknowledge what the rest of us can plainly see? The war in Iraq has deteriorated into an ethnic cleansing/civil war. Why must they persist to ignore these facts?

The answer I am afraid lies in a secret and very controversial law that the American and British governments are pressing the Iraqi government to enact. This secret law being drafted and shortly to be signed involves the oil wealth of Iraq. It is disguised as an effort to reapportion the oil wealth to include all parties, but that is not it’s true purpose.

That’s right the same oil wealth that British PM Tony Blair stated on March 18, 2003, "Oil revenues, which people falsely claim that we want to seize, should be put in a trust fund for the Iraqi people".

And of course there was Secretary of State Colin Powell who stated on July 10, 2003, "The oil of the Iraqi people... is their wealth. We did not [invade Iraq] for oil”.

This new legislation being drafted and sure to be pushed through involves the exploration and development of Iraq’s massive oil reserves. It would allow British and American oil companies to lock in PSA’s (Production Sharing Agreements) signed today for 30 years. These PSA’s would allow foreign oil companies to keep 60-70% of the profits from the oil while they recoup their costs and then keep another 20% of any future profits. On the surface this may not seem too bad until you look at the other OPEC countries and their agreements. All of the major oil producing countries in the world do not participate in the PSA’s. Their leaders recognize that their oil is the wealth of their people and keep it as a state trust. None of them would be crazy enough to sell that wealth using these PSA’s.

What’s wrong with PSA’s you may ask? The problem is not in the PSA’s per se, it is in the terms and the timing. Iraq would be negotiating from a weak position and could get locked into a bad deal for decades. This would not only hand cuff the current efforts at reconstruction, but many future efforts as well. Iraq has been devastated not just by this invasion, but years of UN sponsored sanctions. They are going to need a complete rework of their infra-structure, not to mention their lack of housing. Our military has bombed them back to the Stone Age; the only people with consistent services are those hiding in the “Green Zone”.

I am not against capitalism, but I am against greed. Should the companies that risk their time, money, and manpower be compensated? Of course they should be, but not at the expense of those people who have already lost so much. Because of the political system that was in place before the new leaders have been without for so long they are allowing their short sightedness and greed to prevent them from seeing that they are impoverishing their country for years to come. Regardless of the terms of any PSA they have enough oil reserves to make money, this is not the issue. The issue is whether there will be enough to share with all Iraqis and to provide all Iraqis with a decent opportunity to overcome this devastation.

We should let our voices be loud and clear, “Iraqi oil is for the Iraqi people!” Let’s not allow the big oil companies who have a history of price gouging and price fixing in this country to create another “Saddam” that our sons and daughters may have to go fight again.

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