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Drilling Our Way to a Balanced Budget

February 10th, 2012 · No Comments · Capitalism, Corporations and Industry, Economics, jobs, Politics, Populism, The Budget

The American Petroleum Instititute bankrolled a series of television commercials in which a very emphatic blonde parades through a series of set ups that exemplify the good things that come from their utopian idea of what drilling provides.

There are no mentions of oil spills. There are no mentions of toxic air or water left from drilling or refining operations. And there is no mention of what the atmospheric change, the climate change from the excess of carbon dioxide in the air, is doing to our weather.

Not only 30,000 scientists but something like 80% or more of all living Nobel Prize winners for scientific achievement somehow related to weather have looked at the evidence for climate change caused by man-made factors and agree that our ecosphere is in a precarious position. Lowering the carbon dioxide in the air would have the benefit of reducing the severity of climate change when it comes or as it is coming…right now.

But the Neo-Fascists ( Republicans) who do not want to hear the facts because the facts may have an affect on their incomes or on the incomes of their campaign contributors still want to drill and will support only maximum efforts at drilling for oil.

The television commercial for the petroleum industry says that it will create one million jobs. That would be enough jobs to get us out of the economic mess we are in.

So, OK, let’s drill for oil. But there is one caveat.

Let’s have the American government do it—not the oil companies. The oil companies are supposed to pay royalties but they don’t. The oil companies are supposed to pay taxes but they don’t. The oil company profits are supposed to go to a number of organizations like pension funds and college endowments and mutual funds that help people. But the fact is that a large percentage of stock dividends go to already hugely wealthy owners of oil companies.

We can change that overnight. We can begin to drill in these areas that we have leased to oil companies but which have not been drilled. We can do it by simply setting up…as many other countries have…Mexico, Venezuela, Brazil and Canada, not to mention the highly profitable state-owned oil companies that have enriched Iran, Iraq, Kuwait and Saudi Arabia.

We already have a policy of leasing public lands to private oil companies. We can continue this, only…since oil companies no longer pay taxes…and since there are now only four oil companies, Exxon/Mobil, Chevron, Shell and BP…and since only two are American, we need to raise the share of income the oil and natural gas and mining and timber companies provide to the Treasury.

The oil billionaires have made enough money. They will continue to make money if we increase their royalties to the government. They will not make as much, but we already know that the two remaining U.S. oil companies are among the most profitable corporations in the history of the world.

The American Petroleum Institute says in its television commercial that we can create another one million jobs in this country from new and expanding petroleum drilling. So let’s examine that prospect.

Exxon/Mobil has 83,000 employees. And they generate total revenues of $486 billion. So, if we were able to employ, as the API says, one million new employees, that would be twelve times the number at Exxon/Mobil and gross revenues of five trillion eight-hundred and thirty-two billion ($5,832,000,000,000).

But expanded supply, while we could sell some abroad, would mean lower oil prices. So let’s say that the gross revenues would drop to half that $5.8 trillion. Here is what we could do if half those lower ($2.9 trillion) revenues went to the Treasury.

We could reduce our debt by one trillion dollars a year and be debt free as a nation in 14 years or less. We could completely fund Social Security and fund any shortfalls in the national health care program.

We could retrain all our workers who are laid off into new skills that would make our manufacturing more efficient, our exports more salable around the world and create lasting incomes and retirements for an otherwise unemployable segment of the economy. If we don’t do this, millions of middle-aged workers will be relegated to a life of unemployment or minimum-wage jobs.

Who would object to this? Not the oil companies. Their lobbying group has already said that it is a good idea. The only people to object would now be those billionaires who expect to get more of the piece of the pie than the enormous slice that they already have. Will the newly employed one million workers object? Will the additional 1.5 million who will now have service jobs because of these manufacturing jobs object?

Will the budget suffer from the additional $80,000,000,000 ($80 billion) in income tax revenues to the federal government? (On top of the $1.25 trillion in net revenues from oil.) Not likely.

Who won’t like it? Billionaires. Who cares if billionaires don’t like it? No one except the billionaires.

It is time to take control of our national resources and do what every other country in the world does…use its natural resources to help its people. Norway, a country of less than 5 million people, has better education, better roads, better transportation, better air, better water, less costly electricity and heat, plus better and virtually free health care for everyone.

Our lives can be immeasurably improved by simply using our heads and telling our government, electing officials who will do this for us and tossing out Neo-Fascists who work for the billionaires.

Of course, after oil, comes natural gas and then coal. Let’s get to work on this with our legislators. We want a bigger piece of the action and we want to drill and mine on our own public lands, with our own workers and give a far, far higher share of those revenues back to the citizens who own them.

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