Pres. Obama “Subsidizer-in-Chief”

Yesterday, President Obama gave a speech in Mount Holly, NC, at the Daimler Truck Manufacturing Plant (which is creating natural gas vehicles without the massive taxpayer-subsidy known as the NAT GAS Act, but more on that later). The speech was about innovation and energy and, as always, the President needs to be called out for misstatements.

“Now, here’s the thing, though — this is not the first time we’ve seen gas prices spike.  It’s been happening for years.  Every year, about this time, gas starts spiking up, and everybody starts wondering, how high is it going to go?  And every year, politicians start talking when gas prices go up.  They get out on the campaign trail — and you and I both know there are no quick fixes to this problem — but listening to them, you’d think there were.”

One of the reasons gas prices start going up during the warmer months because the government has mandated that a more costly blend of “cleaner” gasoline be sold during those months. Gas prices would not go up as much in the summer if we weren’t forced to buy more expensive fuel. Hey! That’s something the President could do to lower gas prices!

“As a country that has 2 percent of the world’s oil reserves, but uses 20 percent of the world’s oil — I’m going to repeat that — we’ve got 2 percent of the world oil reserves; we use 20 percent.  What that means is, as much as we’re doing to increase oil production, we’re not going to be able to just drill our way out of the problem of high gas prices.  Anybody who tells you otherwise either doesn’t know what they’re talking about or they aren’t telling you the truth.”

In actuality, the United States has more recoverable oil than the rest of the non-North American world combined. That is far more than just 2%. The 2% figure only refers to the amount of oil recoverable on lands that are currently available for development. But we have far, far more untapped sources of oil.

If anyone tells you otherwise, either they don’t know what they’re talking about or they aren’t telling you the truth – probably for political reasons.

“Here is the truth.  If we are going to control our energy future, then we’ve got to have an all-of-the-above strategy.  We’ve got to develop every source of American energy — not just oil and gas, but wind power and solar power, nuclear power, biofuels.  We need to invest in the technology that will help us use less oil in our cars and our trucks, in our buildings, in our factories.  That’s the only solution to the challenge. Because as we start using less, that lowers the demand, prices come down.  It’s pretty straightforward.  That’s the only solution to this challenge.”

The President is claiming that the only solution to this problem is – as always – government involvement. He and his big-government colleagues must sit around and wonder how this country got as far as it did without the federal government’s involvement in every single industry.

As we’ve stated before, the President’s “all of the above” strategy does not actually include new sources of oil. He claims it does, but his only policy involving oil is to release some from the Strategic Petroleum Reserve.

“Since I took office, America’s dependence on foreign oil has gone down every single year.  In fact, in 2010, it went under 50 percent for the first time in 13 years.”

He’s right, dependence on foreign oil has gone down since he’s been in office, but not because of his policies. He makes it sound like his investments in companies like Solyndra or the 7,000 Chevy Volt owners single-handedly lowered the entire country’s use of foreign oil. It’s laughable on its face.

The truth is that because the “recovery” has been so slow and gas prices have remained so high that Americans just aren’t driving as much. They aren’t going on road trips, they aren’t driving to their vacation destinations. The fact is that the weak economy (and increased production on private land) is what is reducing our foreign oil consumption, and that is something the President can take credit for.

“We’ve approved more than 400 drilling permits that follow new safety standards after we had that mess down in the Gulf.”

This is actually a recent development. This is still lower than the rate of approvals before the BP oil spill in 2010, and has only recently ticked up. Oil production is up on private lands, but the President and his administration have stood in the way of oil exploration on federal lands every step of the way.

“We’re approving dozens of new pipelines.”

Oh, they’ll approve some pipelines, just not one that their key voting bloc disapproves of and one big enough to actually make a dent in the unemployment number.

“So these are the facts on oil production.  If somebody tells you we’re not producing enough oil, they just don’t know the facts.”

Translation: anyone that disagrees with this all-knowing administration is a liar.

“It also means we’ve got to develop the resources that we have that are untapped, like natural gas.  We’re developing a near hundred-year supply of natural gas – and that’s something that we expect could support more than 600,000 jobs by the end of the decade.”

Guess what? The natural gas is already doing this, without the administration’s help.

“And that’s why we’ve worked with the private sector to develop a high-tech car battery that costs half as much as other batteries and can go up to 300 miles on a single charge.”

The Chevy Volt’s battery can only go 30-35 miles and the Nissan Leaf can only go 100 miles on a single charge.  It’s not like this magical, government-engineered 300 mile battery is coming out this year, or next year, or anytime soon. This does no good for Americans now. And, because of the higher level of spending, it does no good for our future either.

“Now, because of these new standards for cars and trucks, they’re going to — all going to be able to go further and use less fuel every year.  And that means pretty soon you’ll be able to fill up your car every two weeks instead of every week -– and, over time, that saves you, a typical family, about $8,000 a year.”

Back up there – $8,000 a year? Not exactly. Politico was quick to fix this error (although they claimed a minor, verbal typo and not a blatant falsehood). In reality, President Obama’s new fuel efficiency standards will save car owners about $8,200 over the life of the vehicle in 2010 dollars.

“And so what I did was I directed every department, every agency in the federal government, to make sure that by 2015, 100 percent of the vehicles we buy run on alternative fuels — 100 percent.

“So we’re one of the biggest customers in the world for cars and trucks and we want to set that bar high.  We want to set a standard that says by 2015, 100 percent of cars, alternative fuels.”

So basically, what the President has mandated, is that American taxpayers buy government employees expensive vehicles that aren’t as efficient as gasoline-powered vehicles – all in the name of the environment? Absurd.

 “To cities and towns all across the country, what we’re going to say is, if you make a commitment to buy more advanced vehicles for your community — whether they run on electricity or biofuels or natural gas — we’ll help you cut through the red tape and build fueling stations nearby.”

More government subsidies! The President didn’t mention at all how to pay for this – no offsets, not even tax hikes – he just simply promised that the government would take care of things by magically providing natural gas fueling stations all across the country. We can’t afford that!

“And we’ll offer tax breaks to families that buy these cars, companies that buy alternative fuel trucks like the ones that are made right here at Mount Holly. So we’re going to give communities across the country more of an incentive to make the shift to more energy-efficient cars.”

He essentially just pitched the NAT GAS Act, which we have been fighting against for over a year now. Why? Because the natural gas industry is clearly on its way up.  Notice that the President was speaking at a plant that – without these NAT GAS Act subsidies – makes and sells natural gas vehicles. His presence proves that the NAT GAS Act is unnecessary.

“In fact, when I was up in New Hampshire, in Nashua, they had already converted all their dump trucks — they were in a process because of this program — they were converting it to natural gas-driven trucks.”

Seriously? Here we go again. The city was already making the conversion without this new government handout. Bottom line: we don’t need these government subsidies for an industry already working!

“This is something that we did in education — we called it Race to the Top.  We said we’ll put in more money but we want you to reform.  We’re going to give you an incentive to do things in a different way.”

If Race to the Top worked, why is the President still calling for education reform? Why would we want to do the same thing with energy?

“Right now, $4 billion of your tax dollars goes straight to the oil industry every year — $4 billion in subsidies that other companies don’t get.  Now, keep in mind, these are some of the same companies that are making record profits every time you fill up your gas tank.  We’re giving them extra billions of dollars on top of near-record profits that they’re already making.  Anybody think that’s a good idea?”

This handy chart shows that while the oil industry receives $4 billion a year in subsidies (most of which are tax breaks afforded to all manufacturing industries and are not oil-specific) we’re spending far, far more on alternative energy. And for what? Taxpayers shell out billions to the wind industry, yet wind only accounts for 2.3% of our energy supply. What’s the point of throwing taxpayer funds down the drain?

“Tell them we’re tired of hearing phony election-year promises that never come about.”

He’s right! Americans much prefer when candidates make promises that come true! Like when the President talked about raising energy prices and he did!

“It’s going to take us a while to wean ourselves off of the old and grab the new.”

The way the President is spending and coming up with policy ideas, he clearly wants us off oil and onto solar, or wind, or something else now – no matter how expensive or inefficient.

The President fails to understand that the free market is already working on what he wants – the next great energy source. Government intervention leads to crony capitalism and innovation malaise because the goal becomes securing more subsidies, not the scientific breakthroughs necessary to remain competitive. Government needs to get out of the business of providing subsidies, only then will energy sources be able to compete on their own merits – and not who has the best lobbyists.

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