The recent debt ceiling debate has prompted increased focus on deficit reduction, with President Obama and congressional leaders proposing various cuts and tax increases aimed at moving the budget towards balance.  As has become typical, for President Obama and his friends in Congress, this means targeting the oil and gas industry with proposals to nix tax credits and deductions that are broadly available across industries well beyond oil and gas.

Ironically, however, two new studies indicate that if Obama wanted to boost revenues from the oil and gas industry, he would not need to do it via pursuing tax hikes.  Rather, according to a new study commissioned by the Gulf Economic Survival Team (GEST), an organization dedicated to helping rebuild the Gulf Coast’s flagging economy, returning to normal drilling levels in Gulf waters would boost revenues demonstrably.

Since the BP Gulf Oil spill – which happened over one year ago – the Administration has been dragging its feet in allowing American companies to drill in American waters. Approvals for shallow- and deep-water exploration permits are down by over 50 percent and 80 percent respectively.  But a resumption of drilling would pour $44 billion into the American economy, create 230,000 jobs and, what’s more, increase tax revenues from American oil and natural gas companies by $12 billion, according to GEST.

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The world price of crude oil has been on a roller coaster lately, gyrating above and below $100 a barrel. Several weeks ago, prices at the pump reached $5 a gallon in some places but seem to have settled down, at least temporarily, to less than $4 in many parts of the country. The elevated cost of gasoline—and of heating oil, aviation fuel and other energy products derived from “black gold”—understandably is a matter of great concern to most Americans.

Rising energy costs already have changed many families’ summer vacation plans, threatened to short-circuit the weak recovery from the Great Recession and, combined with recent increases in food prices, contributed to incipient inflationary pressures that foreshadow a lower standard of living and a return to the stagflation of Jimmy Carter’s presidency.

Fluctuations in crude oil prices are being driven mostly by uncertainty over supplies from oil-producing countries in North Africa and the Middle East, along with a weakening U.S. dollar and other political factors that largely are beyond the control of the much-maligned U.S. oil industry.

But they are not totally beyond Washington’s control. Just recently, President Obama reversed course once again, announcing policy initiatives that the White House claims will increase domestic oil production.

The president says he now wants to lease more drilling areas in the Gulf of Mexico and reduce bureaucratic delays in issuing permits for energy exploration and recovery.

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The Wall Street Journal has a long piece about the prospect of using the state to move part of the U.S. transportation fleet from oil-derived fuels to natural gas. It gives prominent voice to the massive public affairs campaign of T. Boone Pickens, undertaken in the apparent quest for a legacy, locking in subsidized billions for his natural gas fortune as a swansong to a prosperous career.

This campaign takes the form of a bill embraced by ostensible fiscal hawks, causing an uproar and enabling the media to describe the Republicans ‘circular firing squad’, of a base taking umbrage at Members abandoning their pledges of fiscal sobriety at the drop of a billionaire’s phone call. Well played, gentlemen.

The vehicle was not Pickens’ first choice. His first choice was a windmill mandate, transparently pushed by a handful of gas interests, including Chesapeake Energy’s Aubrey McClendon, to put a green hat on their efforts to use the state to displace coal’s market (one of McClendon’s group’s first television ads stated up front, “more wind means more gas”: windmills don’t work that often, so they need ‘backup’ to run wastefully all the time, cycling up and down, and for various reasons inevitably this means gas-fired electricity).

Coal was difficult to budge, what with centuries of it domestically, so some gas folks have been helping the greens’ war against coal for about two decades. This is their latest foray.

And, astroturfers, please hold the mail. I happened to be in the room in 1997 with the American Gas Association, BP, and Enron as they worked with green pressure groups, as radical as the Union of Concerned Scientists as well as more mainstream, anti-coal activists like NRDC, to get a global warming treaty and a domestic cap-and-trade scheme. I couldn’t believe my ears and said so, which in a matter of weeks led to us parting ways.

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Yesterday marked the first anniversary of the disastrous BP oil spill. Remembrance of the fateful months after the spill was followed by strict criticism from several politicians across the country. Gov. Bobby Jindal appeared on television this morning offering praise towards the residents of Louisiana and neighboring states for a resilient and speedy recovery. While the speed of the recovery is reason enough to celebrate, Jindal’s message took a more somber tone, focusing on the “one-size-fits-all moratorium” that was placed on the Gulf States following the spill.

With the stigma of the spill remaining clear in the minds of many Americans, tourism in the Gulf has taken a significant hit. Several Governors are attempting to reel visitors back into their states, but the policies introduced following the spill are only further crippling economic recovery in the Gulf. It is no secret that the price of oil continues to rise at an out-of-control pace. The average price of gas has risen by nearly a dollar since the spill and production has been stunted by nearly a third. Gov. Jindal, and others, argues that increasing offshore drilling would only alleviate some of the economic burden that all Americans face.

As this infographic demonstrates, the administration’s disastrous energy policies have had a hand in nearly all of the deleterious long-term effects of the Gulf spill crisis (click to enlarge).

Safe drilling remains at the forefront of the administrations mind, but the continuation of this moratorium has only hurt small business and added to the already high unemployment rate. The rising price at the pump has spurred increase support for off-shore drilling. A recent CNN poll shows that Americans are beginning to learn towards increased drilling. The survey showed that 69 percent of Americans favor increased offshore drilling, with just over three in ten opposed. That 69 percent is up 20 points from last June, while the oil spill was still in progress, and is back to the level of support seen in the summer of 2008.

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In recent posts, I discussed how Governor Palin’s key legislative victory, Alaska’s Clear and Equitable Share (ACES) , has been a transparent, constitutionally-based, pro-growth success. In 2007, Governor Palin signed into law ACES, an oil tax structure that includes incentives for development and investment in capital improvements and ensured that Alaska’s resources would be developed for the maximum benefit for the people of Alaska as per their state constitution. The Alaska constitution states that the state’s natural resources belong to the people of Alaska.

In essence, revenue derived from oil development belongs in part to the people of Alaska who, as owners of the resources, are due their share of the profits as “shareholders”. Beyond this, ACES also replaced Governor Murkowski’s Petroleum Profits Tax (PPT) which was tainted by crony capitalism and corruption and lead to the arrest and conviction of state legislators and Governor Murkowski’s chief-of-staff due to the ties between PPT negotiations and VECO Corp, a oil and gas pipeline company.

ACES has been a success for both the people of Alaska and the oil companies. In a recent Facebook post, Governor Palin highlighted how the revenues of ACES have benefited the people of the Alaska and have made the state financially sound, as it has helped provide a $12 billion state surplus, put billions is savings, pay down underfunded state pension plans, and forward fund education. ACES has proven to be a success for oil companies as well. ACES has contributed to oil job increases, high profits for industry, a record high numbers of oil companies drilling in Alaska, and increased capital development by oil companies spurred by $3 billion of tax incentives. Alaska now has the second best business tax climate in the country, moving up two spots since the passage of ACES.

In the previously referenced Facebook post, Governor Palin brushes off current criticisms of ACES and refers to desires by some to make changes to ACES as “political posturing”. A bill that would alter the ACES tax structure (HB 110) was passed by the House last week. However, this bill does not even remove the progressivity of ACES–the main criticism from detractors. It solely caps the progressivity. In fact, it changes the calculation period for the tax, and it does not account for volatility of oil prices. It is estimated that such a plan could cost the state $100 to $200 million a year. With a constitutionally sound oil taxation structure that has proven to benefit both the Alaskan people and the oil companies, why might Alaskan legislators and Governor Parnell seek to do away with ACES?Are oil companies and crony capitalist Alaskan politicians using the current political climate (and the anti-oil agenda by the current President) as a springboard for altering the oil structure?

A chorus of voices has risen in support of making changes to ACES, but where are these voices coming from? Are these merely echoes of the corruption of the past? Former Republican Alaskan House member, Ray Metcalfe, indicates that this is likely the case.

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Enron, joined by BP, invented the global warming industry. I know because I was in the room. This was during my storied three-week or so stint as Director of Federal Government Relations for Enron in the Spring of 1997, back when Enron was everyone’s darling in Washington. It proved to be an eye-opening experience that didn’t last much beyond my expressing concern about this agenda of using the state to rob Peter, paying Paul, drawing Paul’s enthusiastic support.

In fact, this case was not entirely uncommon in that the entire enterprise was Paul’s idea to begin with. Which left me as the guy on the street corner muttering about this evil company cooking up money-making charades, to nothing but rolled eyes until the, ah, unpleasantness and the opportunity it afforded to take a few gratuitous swings at George W. Bush. Buy me a beer and I will regale you with tales of reporters from Newsweek and the Washington Post desperately seeking assistance to spin, respectively, Enron as having urged Bush away from the Kyoto agenda as opposed to having crafted it, and Enron’s global warming activism as its one redeeming feature.

The basic truth is that Enron, joined by other ‘rent-seeking’ industries — making one’s fortune from policy favors from buddies in government, the cultivation of whom was a key business strategy — cobbled their business plan around ‘global warming’. Enron bought, on the cheap of course, the world’s largest windmill company (now GE Wind), the world’s second-largest solar panel interest (now BP), to join their world’s second-largest natural gas pipeline network. The former two will only make money under a system of massive mandates and subsidies (and taxes to pay for them); the latter would prosper spectacularly if this war on coal succeeded.

It then engaged green groups to scare people toward accepting those policies. That is what is known as a Baptist and Bootlegger coalition. I sat in on such meetings. Disgraceful.

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My eye-opening experience with Enron revealed to my surprise just how it is that certain interests actually drive Big Green, and make otherwise inconceivable policy ideas into threats and often even reality. The revelation was such that it left me shaking my head in wonder as to how the (now suddenly) obvious, at least seeing how it escapes the interest of at least the establishment press cheerleading the same agenda: when you rob Peter to pay Paul, you are guaranteed the enthusiastic support of Paul.

In fact — as I learned regarding Enron’s and BP’s pet projects, “carbon cap-and-trade” and related ‘green jobs’ schemes all designed to make uneconomic investments in windmills etc. pay off — sometimes the entire enterprise is Paul’s idea.

So it is that we see with deep pocketed gents now scrambling to protect their bets on uneconomic investments and rent-seeking schemes, by supporting the campaign to defeat Proposition 23 in California. Prop 23 would delay California’s climatically meaningless but economically suicidal state-level adoption of Kyoto agenda, called AB 32. Oddly, there is no condemnation of these bags of money being thrown at killing a ballot initiative, despite the opprobrium heaped upon those few who have dared venture in to help the “Yes” campaign.

This is a shame, for the question Cui bono? is so readily answered simply by scanning the growing list of those digging deep to make sure the ‘green’ gravy train of wealth transfers isn’t derailed (regardless of the fairly obvious economic consequences if they are successful, which in a rational world would be of great interest to a watchdog press).

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It’s pure panic time in Democratic circles as the 40-year reign James Carville predicted seems to ending a few decades early.

MoveOn.org, a long-time Progressive powerhouse in DC and around the country, is running around with its hair on fire and preparing for a bad November.

And the group is currently trying to figure out what friends to save and which ones to toss overboard.  A September 4 e-mail to members said:

In this election we’ll focus on a handful of progressive heroes facing tough races, where we can make a real difference together. Which progressive heroes would you nominate to be our top priorities this fall?

It can be a long-time member of Congress or someone running for the House or Senate for the first time. He or she should be a proven progressive fighter, especially in standing up to corporate influence in Washington. And since we have limited resources, please nominate folks who are in truly close races where MoveOn members could swing the balance.

A few days later, MoveOn issued this e-mail:

Election Day is less than two months away, and we need to decide today whether we’ll have enough resources for a major campaign to help stop the Republicans and their corporate allies from taking over Congress.

In a survey over the weekend, 92% of MoveOn members said that we should work broadly to help Democratic candidates—especially now that corporate front groups are spending $400 million to boost Republicans’ chances.

But MoveOn went into full panic mode the next day, attempting to instill fear in its Big Government-loving members:

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As businesses along the Gulf Coast await the expiration of President Obama’s offshore drilling moratorium, they’re faced with a new hardship: Neither BP nor the Gulf Coast Claims Facility appear willing to pay for lost income resulting from the ban.

Last week BP announced it was deferring all moratorium-related claims to Ken Feinberg, the Obama-appointed administrator of the $20 billion claims fund. That news came as a surprise to Feinberg, however. He maintains the moratorium claims are BP’s responsibility.

“Those claims are not under Feinberg’s jurisdiction with the GCCF,” spokeswoman Amy Weiss told me. She referred questions to BP.

But a spokesman for BP said the company is planning to transfer all outstanding claims to Feinberg, including those from businesses that cite the drilling ban.

“There are claims in the system that are moratorium-related,” BP spokesman John Curry said. “The entire database will transition to the Gulf Coast Claims Facility when Feinberg gets it up and running.”

The uncertainty — and apparent unwillingness of either BP or Feinberg to take responsibility — leaves businesses in the dark about their moratorium-related claims. Those businesses could be mom-and-pop stores that rely on the steady flow of customers working on rigs or suppliers of oilfield equipment. Each is affected by the moratorium in its own unique way.

So far BP hasn’t rejected any claims, but many of the 147,194 remain unresolved. The company has made 116,063 payments, totaling more than $340 million. It does not have a breakdown of how many claims are related to the moratorium.

Obama’s drilling ban creates a tricky situation for BP and Feinberg. At the president’s request, BP pledged $100 million for oil rig workers affected by the moratorium. But those grants are limited to the estimated 9,000 people who worked on the 33 deep-water rigs when the federal moratorium began on May 6. Workers have a 30-day period to apply beginning on Sept. 1.

Because the Gulf Coast states are so reliant on the energy industry, the moratorium is having a widespread impact beyond the 33 rigs that were idled when Interior Secretary Ken Salazar first instituted the drilling ban. Two of those rigs have already left the Gulf for Egypt and Congo.

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With the midterm elections approaching, it is now clear that cap-and-trade, Democrats’ main weapon in their war on energy companies, is effectively dead—that is, at least until after the election, when some Democrats who may then be exiting Congress will feel more comfortable supporting it.

However, the demise of cap-and-trade does not mean Democrats have put what some dub “plans” to target energy companies on hold completely, or placed them on the back burner.

The Obama administration has worked hard to impose a moratorium on deepwater drilling, which one prominent expert says could directly result in a loss of $2.1 billion in output, nearly $100 million in forfeited tax revenue, and close to 10,000 mostly middle-class job losses.

In addition, the agency responsible for issuing new permits to drill in the Outer Continental Shelf (“OCS”) has issued just four permits during the last three months, as compared to 56 permits in the three months prior to that.

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The Hill  reports the latest attempt by the Democrats to deflect the outrage of the American people by blame shifting the cause of the Gulf oil spill disaster to former VP Dick Cheney and the Bush administration:

Members of the House Energy and Commerce Committee traded partisan blows Tuesday over whether the Obama administration or the former Bush administration deserves more blame for the catastrophic Gulf of Mexico oil spill.

Senior Democrats on the panel — Chairman Henry Waxman (D-Calif.) and Rep. Edward Markey (D-Mass.) — used a hearing on the Interior Department’s role to trace the disaster back to former Vice President Dick Cheney’s energy policy task force.

Waxman said that task force — which was assembled early in the Bush administration — set the stage for policies that pushed drilling at the expense of tough safety oversight of rigs and review of environmental risks.

“The cop on the beat was off-duty for nearly a decade and this gave rise to a dangerous culture of permissiveness,” Waxman said. “In many ways this history begins with Vice President Cheney’s secretive energy task force.”

Waxman said that under the Bush-era Interior Department, “the priority was more drilling first and safety second,” although he added that the current administration was also too hands-off before the spill.

Seriously?   Waxman and Markey obviously did not have access to this outstanding timeline and writeup by Kevin McCullough, which details the events dating back to February 13, 2010:

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In a rebuke to President Obama, a Senate panel last week gave a thumbs-up to the creation of an alternative Gulf oil spill commission to rival that previously announced by the President.

The bipartisan commission was approved by five Democrats and ten Republicans on the Senate Energy and Natural Resources Committee.

Its members would be determined mainly by Members of Congress, on a 50/50 Democrat/Republican basis, with President Obama retaining the power to appoint the Chairman.

The move followed intense criticism of President Obama’s own announced commission—composed in substantial part of anti-drilling members like Natural Resources Defense Council President Frances Beinecke, and several individuals professionally focused on environmental law— from Democrats and Republicans alike.

Sen. John Barrasso (R-Wyo.), one of those involved in the alternative-commission effort, said earlier this week that the Obama Gulf oil spill commission “appears to me to be stacked with people philosophically opposed to offshore drilling.”

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I sat chuckling all through Obama’s immigration speech Thursday. Forgive me, but that has been my recent response whenever I listen to Obama’s speechifying. I am somewhat surprised at my recent response to his outlandish rhetoric, but he makes such a mockery of his very words, of America, and of capitalism, that he is, invariably, comical.

He recited Emma Lazarus’s poem “The New Colossus,” which is engraved at the base of the Statue of Liberty, yet he has disparaged American exceptionalism and prides himself on being post-American. How can you not bust a gut?

So I listened to his speech on immigration and chuckled as he lectured us, yet again, on what America is — as if he had a clue about what America is. His contempt for us is so palpable. As if he had any respect for what makes America great – free speech, individual rights, entrepreneurship, and privacy rights. As if he had a clue as to why legal immigrants come here — to escape tyrants and would-be tyrants like him.

I understand why he must ram immigration through now. And why he is taking this issue on now after destroying the American healthcare system. He has no shot of re-election without a base of amnestied illegal immigrants voting for Democrats. It is his only motive — but I digress.

What about the Gulf? This is a catastrophe of unfathomable proportions, the decades-long repercussions of which have not yet begun to be understood or calculated. What about those people, those communities? Whole swaths of coastline, entire towns, even entire counties may face evacuation.

Why isn’t the President of the United States working on the problem 24/7? I want to know why the nation’s Chief Executive has not been holed up in a war room, 24 hours a day, seven days a week for the past 72 days, working with the world’s finest scientific minds and oceanographic and energy experts to solve the oil spill crisis.

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For years, liberals in Washington have tirelessly thwarted America from tapping its domestic sources of energy, while hypocritically lamenting our “addiction to foreign oil.” They have forsworn abundant energy supplies just off our coasts and erected boundaries against drilling and energy development right here at home. The unfortunate effect of their effort is to unnecessarily drive exploration further and further offshore, to deeper and deeper depths.

Suddenly, those same forces are forging a marriage of convenience with BP to scapegoat the entire energy industry for BP’s individualized failures. In his Oval Office speech to the nation, for instance, President Obama resorted to sloppy slurs against “oil industry lobbyists” and “an entire way of life being threatened by a menacing cloud of black crude.”

By doing so, the far left factions of Congress and the administration seek to use the Gulf spill as a political opportunity to shove an ulterior agenda down America’s throat. In that same Oval Office speech, Obama exposed his real agenda, saying, “we have failed to act with the sense of urgency that this challenge requires,” and, “the time to embrace a clean energy future is now. Now is the moment for this generation to embark on a national mission.”

Does the phrase “never let a crisis go to waste” ring a bell?

What these liberal opportunists forget is that oil helped propel our nation’s very economic growth and prosperity for over a century. The overwhelming majority of America’s energy enterprises possess a proven track record and have managed to safely extract oil for decades. According to the Interior Department, offshore drilling produced seven billion barrels of oil between 1985 and 2001, with a spill rate of just 0.001%. The Obama Administration, however, is attempting to punish others for the failures of BP, which has long suffered from an abysmal safety record relative to its peers.

One disturbing byproduct of the recent Gulf spill is the light it shed on the cozy relationship between BP and the Obama Administration. Despite the usual empty tough talk from the White House, the close association between the White House and BP is a commonly known fact inside the Beltway. The reality is this crisis has brought to light the codependency of BP and the Obama administration – each gaining from the others cooperation.

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If President Obama’s Oval Office speech made one thing clear, it is that his administration and the activists who back it view the Gulf oil spill as simply an opportunity to advance their pre-existing agenda—which has nothing to do with cleaning up the Gulf, protecting the fragile coastal environment or fostering the region’s economy.

Although now overruled for the time being by a federal judge, the Obama administration’s May 27 order to stop all deep-water exploratory drilling in U.S. waters of the Gulf of Mexico for six months, pending the report of a commission investigating the causes of BP’s Deepwater Horizon accident, is a case in point.

Public and political reaction to the devastating oil release in the Gulf has revitalized a coalition of environmental and anti-energy lobbies that oppose not only deep-water drilling, but all offshore oil production and, in some cases, all use of fossil fuels. As usual, political opportunists have been quick to seize the moment.

“You don’t want to let a good crisis get away,” declares Athan Manuel, director of lands protection in the Sierra Club’s legislative office. The organization is urging a permanent moratorium on new offshore drilling.

Kieran Suckling, executive director of the Center for Biological Diversity, disputes industry claims that shallow-water drilling is much safer than deep-water drilling. The center wants the existing six-month moratorium extended to all offshore drilling.

Such lobbying already has born fruit. On June 8, the administration issued new safety standards for shallow-water drilling. According to Bloomberg Businessweek, “as many as 50 shallow-water drilling rigs that employ about 5,000 workers may need new permits in the next six weeks under the administration’s new review.”

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A lot of things have gone wrong in the last 72 days since oil started spilling into the Gulf, and very few things have gone right. Unfortunately, the oil spilling into the Gulf is only one of many, many problems in the Gulf. There are the obvious problems of extremely polluted water, the oil soaked animals, the oil soaked beaches, the loss of tourism, the loss of jobs, and the loss of faith in the process that is supposed to ensure things like this never happen. But, why hasn’t the oil been cleaned up? Why is the leak still spewing oil into the Gulf? BP has their fair share of blame, but so does the federal government.

The government has had a lot of missteps. The EPA would not allow ships to skim oil from the water because they couldn’t get 100% of the oil out. They could only get 99% of the oil out. They failed to get rid of the horribly outdated Jones Act that forbids foreign vessels from helping us clean up the gulf. There have been plenty of problems with the way the Federal Government has reacted to the oil spill, but it’s never too late to start getting it right.

The Heritage Foundation has put together a list of things the Obama administration can do to mitigate the damage that the oil slick can still do. These are steps that can be taken immediately, and more items will be added to the list when appropriate. Simple things like waiving the Jones Act (as the Bush Administration did during Katrina), or accepting international assistance. Or allowing ships like the S.S. A-Whale–that has the capability to skim 500,000 barrels a day– to immediately start assisting efforts. It’s in the Gulf now, but it is still not being used.

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While the White House really, really wants you believe that they have their boot on the neck of BP, it turns out that a key Administration official had his head inserted somewhere else just three short years ago. Do you think NOBEL LAUREATE (and Secretary of Energy) Steven Chu still thinks BP is going to help save the world?

This is one of the ironies of the disaster in the Gulf. From all available evidence, BP is as committed as anyone to the “comprehensive energy reform” agenda of the White House. No doubt this reflects both political realism and market opportunism on their part, but BP’s 2009 “Road Map for America’s Energy Future” could have been written by John Kerry. Higher energy prices, cap and trade? Bring it on, says BP.

And this isn’t a recent shift on BP’s part. Here’s embattled BP Chairman Tony Hayward back in June 2007:

From BP’s perspective, the evidence that climate change is happening, and that it is manmade, is mounting all the time. As the UN’s Intergovernmental Panel on Climate Change has found, the evidence is almost overwhelming. We could wait until the science is 100% certain, but BP believes that, as an energy company, it has a duty to act pre-emptively. When you balance the likely impacts of not taking action against the real opportunities that exist to take action, it is difficult to believe that humanity will not move towards a solution to climate change…

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In a June 14th editorial entitled “Politicizing the Fed,” the Wall Street Journal sheds light on one of the dubious regulations of the upcoming financial reform bill.  The Journal states:

The biggest underreported threat comes from Subtitle I, Section 1801 of the House financial reform bill titled “Inclusion of Minorities and Women; Diversity in Agency Workforce.” Sponsored by California Democrat Maxine Waters, the provision requires each federal financial agency, the Fed Board of Governors and the 12 regional Fed banks to “establish an Office of Minority and Women Inclusion.”

So what else is new, you say? Don’t the feds already dictate racial and gender hiring? Yes, they do, through the Equal Employment Opportunity Commission and assorted other federal laws. As a matter of racial and gender diversity, the Waters provision is at best redundant.

But Ms. Waters and the House are hunting bigger game—to wit, the political allocation of credit.

[...]

The House provision makes that very clear by making each diversity officer a Presidential appointee who must be confirmed by the Senate.The post, says the bill, will be “comparable to that of other senior level staff.”  The post, says the bill, will be “comparable to that of other senior level staff.”

The law says this diversity czar will “ensure equal employment opportunity and the racial, ethnic and gender diversity” of the work force and senior management of these institutions. More ominously, this creature of Congress and the White House will also be charged with “increas[ing] the participation of minority-owned and women-owned businesses in the programs and contracts” of each agency and conducting “an assessment” of stated inclusion goals.

Mull over that one for a minute. Having recently lived through a financial mania and panic caused in part by political pressure for “affordable housing,” Congress will now order regulators to allocate credit by race and gender.

In an article I wrote on February 28th entitled “Fiscal Death by Welfare,” I argued: “I believe that as the downturn goes on the government will blame the banks for the lack of economic growth and force them to allocate credit to chosen political entrepreneurs and other bad credit risks…”  I truly wish I had been wrong in my assessment.

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The other day President Obama gave BP an ultimatum, he met with BP executives for the first time, and squeezed $20 billion from the company.  He also made a prime-time bomb of a speech.  Moreover, in that short period, Tony Hayward has been demoted, a part-time czar has been appointed, and it is now reported that claimants are being turned away.

The success the Obama administration had in getting the oil spill live feeds off the front pages of websites and cable news stations and cause the change in the narrative from millions of gallons of oil gushing to a seemingly more proactive, authoritative, and administrative role in managing the devastating situation is remarkable.  At last, PR success.

There is, however, a major problem with all of this:  the oil is still gushing from the well and now there are large amounts of methane causing dead zones.  The “damn hole” is not plugged.

To review, BP confirmed that oil was gushing at a rate of 35,000 to 60,000 barrels a day, which would be equivalent to 1,470,000 to 2,520,000 (million) gallons per day (42 gallons equals 1 barrel).  Presently, the oil continues to flow, but the rate is unknown as reported by CNBC on June 11:

Under the current system, a containment cap placed atop the gushing well pipe a mile below the ocean surface is funneling some of the escaping oil and gas from the bottom of the Gulf of Mexico to the surface to be collected in ships.

An undetermined amount of oil continues to escape from the cap into the ocean.

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