Sol Sanders | Follow the Money No. 73 | Obama energy strategy: one part black magic, two parts propaganda

rcwhalen's picture

Here's the latest from Sol Sanders. A version of this column is cheduled to appear Monday in The Washington Times.  -- Chris


the Money No. 73 | Obama
energy strategy: one part black magic, two parts

Sol Sanders

and again, we must return to energy, the mother’s milk of the economy where the
Obama Administration’s ham-fisted tactics are strangling the baby of recovery in
the crib.

his June 29th press conference, the President again singled out rebates to push
fossil fuel production in his demand for tax increases for an economy already
threatened by double-dip recession. The proposal compounds regulatory mischief:
blocking oil and gas in the
of Mexico

while Chinese and other foreign companies drill off
almost within sight of
beaches, forfeiting 250,000 jobs. “Regs” threaten

fields contributing 20% of
new production because of an obscure lizard. The White House dallies over a
pipeline to bring Canadian oil sands crude to
refineries. While
pushes Arctic prospecting,
can’t get
to open up 14.7 million acres of state land with the critical Alaskan pipeline
faltering from declining throughput.

Obama’s token strategic oil release – into the international crude pool rather
than reducing
pump prices – was one more feint in Mr. Obama’s ideological war on fossil fuels.
[Never mind ignoring the reserve’s national defense character; it was never
meant as a price instrument – nor political toy.]

this is done under the rubric of protecting the environment. “Junk science”, as
many highly qualified skeptics believe, may underpin claims fossil fuels
consumption decisively impacts climate change. It will take decades to know,
given our shallow data for changing climate through the

“junk economics” is all too evident in the Administration’s energy strategies.
Granted, impediments to cheap energy were inherited from previous governments
and imperfect markets. But Mr. Obama’s drive for “renewable sources” mimics
earlier Carter Administration’s abandoned “alternative energy” skeletons still
littering the landscape.

Obama’s wind power subsides are indeed producing jobs – for
– with transferred American companies' technology. Chinese windmills and solar
panels are exported to the
often replacing American manufacture.

vignette of former Gov. Arnold Schwarzenegger entertaining the possibility of
Chinese “high-speed rail” proposals with federal stimulus funds – just before
all but bankrupted -- is quintessential of a mind set. High salaried
propagandists for tax free non-governmental organizations [NGOs] promote “the
environment” through advocacy of “mass transit”, citing
example. They fail to note deficit-ridden Chinese government railways – whose
two top executives recently were arrested for stealing tens of millions –
blackmailed European and
companies for technology transfers in exchange for a phantom Chinese market. Now
attempts exports while their own projects operate with anemic passenger loads --
at lower speeds because of faulty engineering. The misrepresentation is all too
typical of limitless, mindless propaganda pumped out on a daily basis, for
example on that other
subsidized enterprise, National Public Radio, by the Obama cheering

fact, a whole new era in fossil fuels is beginning. So-called “peak oil”, the
crisis posited when diminishing reserves supposedly would meet rising
consumption, has vanished. New vistas have developed worldwide with expanding
deep-water drilling technology – a Norwegian billion-dollar floating platform in
deep water off
de Janeiro
a good example. New fields await discovery in our own
of Mexico

– the less than cataclysmic British Petroleum oil spill notwithstanding.
with the world’s second largest reserves, many yet untapped, is returning with
10 million barrels a day.

more spectacular, a new era for natural gas suddenly has emerged with new
technology exploiting vast shale reserves lying deep below rock formations in a
dozen countries, not the least the U.S. [An ironic comment on priorities:
is investing government billions into American companies to get at that
technology.] Of course, there already has been a half-baked university “study”
by enviromentalistas arguing “fracking” – the process of getting at that gas –
would poison ground drinking water. The study produces not a single instance nor
does it explain the risk with most such deposits lying well below

correct” spokesmen and the mainstream media promise black magic energy
solutions, for example, electric cars, ignoring almost three quarters of our
electricity for recharging batteries is met with coal and gas – much less the
enormous costs and problems of grid expansion required for a massive changeover.

conjuror’s trick has gone wrong; Mr. Obama is actually cutting the beautiful
young lady in half as he cripples the energy sector.

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bruiserND's picture

Chris Whalen, brilliant as usual. "Deflated" best non fiction book of 2011 - 2012

"The White House dallies over a pipeline to bring Canadian oil sands crude to Texas refineries." needs clarification.

The Secretary of State partnered with EarthJustice , Natural Resource Defense Counsel to block the Keystone anex pipeline  .  This pipeline would deliver Alberta / Saskatchewan in such quantities with the lightest sweetest crude ever discovered anywhere EVER that it would break OPEC/ Venezuela / Mexicos' back. The Bakken field in North Dakota & Montana need the Keystone pipeline. If they had it America could break OPEC et al in 2 years.

You used the term "junk science".We have by now, all seen Academy Awards  Documentary winner "Inside Job"  that academics for hire specializing in economics helped to facilitate fraud and the fiancial coup d 'etat on America. Junk Science, " we'll say anything you pay us to say and call it science", science for hire, is killing or has in fact already killed, America.


When I'm elected Governor of Montana in 2012 we'll fix these things and teach you how to fly fish & ride a horse too.

Urban Redneck's picture

Build a shorter pipeline to MN and then build a refinery there.  Pumping sludge thousands of miles downhill, and then right back uphill, reduces the the net BTUs available to consumers.

Flakmeister's picture

You completely overestimate the significance of the Bakken... Great field but no game changer...

ian807's picture

There you go bothering people with facts again. Hasn't anyone talked to you about that yet? :)

Sufiy's picture

Must see vide:

Peak Oil presentation May 2011 U.S. House Session 

We know the reason for panic SPR release - will anything changed now?

John_Coltrane's picture

Not a lot of information in this article as noted by others-more of a rant.  So, I'll add a little puzzler on climate change?  How can a minor gas like CO2 influence climate more than the major green house gas, H2O (you know the stuff in the oceans that forms clouds the major influence on heat retention and radiation at the earth's surface)?  And why does the amount of CO2 in the atmosphere always follow/not preceed (i.e. an effect not a cause) an increase in surface or ocean temperature temperature, T?  Hint:  why do bubbles of gas occur upon heating water?

Yes, the climate is always changing and the causes are complex-a cooling trend would be much worse for life than the current 10000 year warming trend that we are currently experiencing. 


jack stephan's picture

"plans within plans."

cesarsp_us's picture

I just dont buy it we all know that the cheap easy oil is gone 

TSA gropee's picture

This is just one play of an extensive playbook in redefining America and is part of the change from that hope and change thingy.

dougngen's picture

The main point of this post went from how the current administration is doing evertyhing in its power to prevent the U.S. from producing oil (having a negative impact on the economy); to a discussion on peak oil, alternative energy, and a host of other topics.

 It's quite clear to me that our current POTUS sees America as a colonial power that has unfairly exploited the resources of lesser countries and people. (This may or may not be true, but it is irrelevant today). Our Dear Leader is doing everything in his power to punish America for its past "sins".

JW n FL's picture


Exxon oil spills in Yellowstone River, forces evacuations

Spill stretches over dozens of miles; not sure what caused pipeline break



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steve from virginia's picture


Chris Whalen ???


Mebbe it's the 'other' Chris Whalen. The article reads like something ... found on the pages of the New York Times!

Nuttin' to worry about folks, just run down and buy a new car. The bigger, the better.

Peak oil is easy to figure: when the rate of oil demand exceeds the rate of extraction. That's it. If you can understand a leaky bucket, you grasp peak oil.

Lotta things peakin' hereabouts: peak water, peak money/credit, peak this, peak that. Peak is where it's at right now. The smart trader- dude figures out how to trade 'peak' since the other trades all lose.

Peeps have the wrong idea about this energy business. Oil shortages these days won't be argyle sweators or malaise, gas lines or 'odd-even days'. It is riots in the streets, bankruptcies of countries, civil wars, food shortages and a debt crisis. Hard to find oil is expensive and credit is required.

Burning up more valuable oil does not have any return, so bankruptcy is baked into the cake. It's the lack of return that is putting the world into the poorhouse (or debtor's prison, whatever the case might be.)

ian807's picture

Mr. Sanders. It's unfortunate that your education did not include arithmetic.

For a numerate discussion of our oil depletion situation, I suggest you read the book refernced on this site:

It has numbers. Try. 

The bottom line is that even if we drilled the entire gulf of mexico, Alaska, Texas, Oklahoma and your backyard, *all* of it simply doesn't amount to anything near enough to running a country that uses between 8 and 9 billion barrels of oil a year. Our twenty one billion barrels of known recoverable oil (i.e. oil that's energy positive and cheap enough to matter), would last less than three years. But hey, lets assume magic fracking technology and double it. We get to 6 years of total energy independence.

We will drill the Antarctic, Alaska and the gulf. Make no mistake. We'll use good coal and lousy goal, and gas. We'll start planting sugar and think hard about annexing Cuba. We'll use wind, and solar and geothermal. We'll dam rivers. All of it together won't replace the 40 exajoules of energy or so used by the USA each year. So we'll cut back. There'll be limits. Forget "growth." Think "survival."

At current consumption rates, the world would have 50 years until the proven recoverable oi is largely used up. That's assuming we all learned to share, nobody hoards for their own population and their own military and we all join hands and sing "Kumbaya." Trouble will happen in a much shorter timeframe than 50 years. Economic decline will start in 10, be undeniable in 20 and be shaking the world's economies like an earthquake in 30. 

No doubt magic conservative capitalist white knights will ride to our rescue and save us all. Good luck with that.



Zeilschip's picture

Why is every other article on ZH nowadays about how China is to blame for every US problem??

dcb's picture

the earth is a closed system that I am rather sure has adaptive properties. what the extent of those are is rather too complex for me to determine. the only thing I am certain is that once we fuck it up enough there ain't no leaving. Hence, my vote usually leans towards more nonpolluting methods that cause less environmental damage. it that means making sure products are more energy efficient, smart, etc. sounds good to me. I am at a loss to understand why farm/ animal waste is not being converted into energy instead of being stored in massive ponds that leak. Same with city garbage as well (landfills).


At some time you have to adopte sustainable pratices. Can't way when or what the capacity for human life is on the planet esp if we ignore other species. I just know that bacteria grows in a petri dish until it runs out of medium to grow on. at that point the stuff growing there feeds of of itself in some way. eventually because it is a closed system the the crap dies.

CrashisOptimistic's picture

One of the worst articles to appear in ZH.

"In fact, a whole new era in fossil fuels is beginning. So-called “peak oil”, the crisis posited when diminishing reserves supposedly would meet rising consumption, has vanished."

It's not a religion.  It's not something one believes in or not.  But it IS SOMETHING THAT REQUIRES ONE TO GET THE DEFINITION CORRECT.

Peak oil is about production.  There is no consumption component to the computation.  It is strictly oil production and only oil production.  It is dying fields' production trying to be offset with new fields' production, with those new fields themselves soon becoming dynig fields after a few yrs of production as it individually forms a peak for itself.  The global graph that forms the "Peak" is STRICTLY OIL PRODUCTION.

If the guy doesn't even know the definitions, why is he allowed to appear on ZH?

cpnscarlet's picture

Some thoughts converning peak oil. -

It's hard to think that crude oil in the earth came from the reamins of dead organisms that lived millions of years ago. If it did, how are the oil fields still under pressure after all that time, and how many animals would have had to live and die to become the trillion+ barrels pumped so far. Do we really know where oil comes from...will a geologist help me out here.

Isn't it thoroughly possible that there is a carbon cycle active in the earth's crust and mantel that is continuously cooking carbon molecules from all sources (organic and otherwise) in the heat of the deep crust. Isn't therefore also possible that that cycle continues to this day? Isn't it also possible that, as we speak (read), NEW oil is being formed and is making it's way toward the earth's surface?

You can't cook GOLD or SILVER into existence with the heat/temperature that exists in the earth's interior, but you can sure synthesize crude oil. So simply put - exactly what is at a peak of production????

AuAg must be bought. 

blunderdog's picture

You're not thinking big enough.

Sure, it's totally possible the world produces an effectively limitless supply of oil thanks to natural processes.  But why stop there?  It could also produce an infinite amount of GOLD through nuclear fission processes in the core of the planet.

If we can turn lead into gold in a particle accelerator, who's to say with any certainty it can't be done naturally in the core of the Earth?  Has anyone ever been to the center of the Earth to prove it's impossible?  I think not. 

For that matter, there could be natural processes we haven't discovered yet which turn salt into cocaine, and mutton into Angus beef.  There could be a whole conspiracy built up to prevent these truths from being discovered!

cpnscarlet's picture

Well, to quote Indiana Jones, "Now, you're getting nasty."

I made the point that the temperatures and pressures at the core of the earth couldn't possibly produce heavy atoms, but the temperatures and pressures in the deep crust or mantle certainly could push forward hydrocarbon synthesis using all the carbon and hydrogen compounds being pulled down at the interface of the various Pacific plates.

There's nothing unreasonable or "flat earthish" about such a proposition. And even if oil is not abiotic at all, why does the raw material have to be dinosaurs? Couldn't it be them as well as any other living tissue thing that has ever existed?

Finally, as far as the velocity of monkey fornication....I want to come back in my next life as a Bonobo Chimp!

blunderdog's picture


Dude, you went a damn long way to find THAT strawman.

As I mentioned above: it's quite possible there's an effectively limitless supply of oil.  It'd be a little strange that our production levels are falling, but whatever.  Maybe we just haven't caught up yet.  We can assume that what we've been experiencing will continue to be the case in the future, or we can assume that some "as-yet-unimagined" solution to all our problems will fall into our laps while we continue to practice all the same behaviors that got us to this point.

That's just optimism, right?  Or maybe wishful thinking.

Whenever I've been at a coke party, we've just kept snorting the stuff, and so far, it's never replenished itself for us. 

Maybe oil's different.  Can't prove it's not.

cpnscarlet's picture

Okay...don't be so literal. Let's say "pre-Adamite" organic matter. Or how about this to bring it to brass tacks - If oil is a true "fossil" fuel, why did the synthesis stop at a certain point in time. Why do we think the pot's off the stove now?????

Boy, you people can be so picky!

blunderdog's picture

Another strawman?  As far as I know, no one suggests oil synthesis has stopped.  Go dig up a graveyard in a few million years and report back.

The concern I've heard is that in the past few hundred years, we may have pumped and burned a few hundred million years worth of oil production. 

Maybe a time machine is the previously unimagined solution to solve all our problems. 

We'll just send everyone into the future a few million years from now so there'll be another few hundred years' worth of oil to drill.  The planet should've cleaned up some of our pollution by then, too, and Fukushima will no longer be too hot to inhabit.

Although...the time-machine better not be gas-powered, or that won't work too well. 

snowball777's picture

Your ignorance is quite frightening...enjoy the sun circling your flat earth.

ArmchairRevolutionary's picture

Isn't it thoroughly possible that you are positing a theory that is based entirely upon wishful thinking? I would suggest that you read gerryscat above; deal in facts that we know versus theories that we would like.

delacroix's picture

I wonder how many dinosaurs died, on planets, where we have identified, large quantities, of complex liquid hydrocarbons?  is it too farfetched, to speculate, that the bulk of the petroleum, was formed, with the planet itself?  and it is finite, though we can't estimate how much remains, if we base, our estimates, on a false assumption.

blunderdog's picture

You have to set the bar for "complex" pretty low.  If propane/ethane are "complex" hydrocarbons, sure, but that's a world's difference (literally) from crude oil.

Which is not to say abiotic oil is impossible--far from it.  It's certainly possible the Earth's natural chemical processes are producing oil.  Seems no one's found much of that abiotic oil, though, and the theory hasn't helped exploration significantly.

Jury's out.  It's a nice idea, but it'd gain a lot of credence if there were any good evidence.

snowball777's picture

Assume, for the sake of argument, that abiotic oil exists (laughable, but for the sake...).

Is it replenishing the supply faster than monkeys can fuck?

DaveyJones's picture

that really is the right question to all this silliness. And why do they keep calling it dinosaurs. And why do they think there were not enough living organisms to form this over hundreds of millions of years. and why do they think that drawing half of it out in one hundred while building your entire society on it is not a problem

gerryscat's picture

"peak oil, the crisis posited when diminishing reserves supposedly would meet rising consumption, has vanished"

For that you get 1 star. You clearly don't understand peak oil. Peak oil doesn't mean oil is GONE one day, it means we are half way through it, that's ALL. 

Fact: diminishing reserves

Fact: deeper and deeper wells

Fact: more and more expensive to extract

Fact: more and more environmental impact to extract

Fact: increasing demand

Fact: crisis can take years to develop, not 15 minutes


snowball777's picture

Very simple diff eq of supply (plateau'd or declining) and demand (rising exponentially with population...each individual member of which wants to drive a car getting shitty mileage to an air-conditioned home and watch a large flat-screen while drinking a nicely refrigerated beer).

Actually, a crisis could happen overnight (okay weeks) and has ('73..'08) because of our economy's sheer exposure to the price of petro products (every commuter), the shock that induces in anything delivered by truck, and the other inputs that depend on black goop (fertilizer, electricity, and plastics).

Oil is the only reason Ben isn't already stuffing QE3 down the PDs pants with both fists.

DaveyJones's picture

of all the dangerous things that Ben's dumb little tricks produce, the price of oil takes the cake 

Flakmeister's picture

This article has to rank with the very worst that has been submitted to ZH since its inception.  It is shallow and partisan, replete with faulty analogies, it reads like a manifest of denial....

SimplePrinciple's picture

I am astounded at the viciousness of many of the comments on this piece.  It is as though people are bound and determined to make the Malthusian vision come true.  What has kept it at bay for the last 200 years is individuals seeking their own prosperity through investment and innovation in response to the decentralized signals of free market prices.  Yet now we enter an era of global central planners trying their best to subvert those price signals.  In this way we open the door for the Malthusian end, namely squalor and starvation.

Urban Roman's picture

What has kept it at bay for the last 200 years is a one-time bounty of fossil fuels.

When they are not-so-cheap, the zombie Malthus may just come stomping back.

dolly madison's picture

Cheap oil is running out.  Expensive oil is infinite.

taraxias's picture

bullshit, nothing is infinite

Hohum's picture

Where in the world did all these numbers come from?  And, not surprisingly, no numbers on the net energy from these new prospects.

Urban Roman's picture

Yup, thanks for that.

The facts are out there, and some folks with better credentials than I have run the numbers.

Not that it will change the minds of the truly religious.

nah's picture

just keep the oil off the lawn

onlooker's picture

The oil companies should have the job to explore, discover, produce, and refine oil and gas. It may be to their advantage to restrict those endeavors (government regulation) to control the supply and pricing. It may be of a National interest focus to use the vital raw materials like oil of other countries while conserving our own. Regardless of environmental issues, we will have a peak in all natural resources, including water and food. Europe should have the same problem. They have always had high fuel prices and have created good MRT, mass rapid transit. Los Angeles had a good rail MRT until the 1950s when the oil and tire companies were able to eliminate it with a bus system.


There are large coal reserves in the USA. Clinton turned the Worlds 2nd largest low sulfur coal reserve into a National Park making it off limits for mining.  At that time there may have been come collusion with Indonesia who has the largest low sulfur reserve.


The sweet spot of the present situation is that the government and the oil companies have the consumer where he has to buy oil products at the price they dictate. The only defensive move is to buy an economy car and drive less. With the economy broke and the citizens unemployed, the option to get a more efficient car is reduced, leaving America like a deer frozen in the bright light of the oncoming car.


The option to build MRT is nil due to the Governments bankrupting themselves.


The upside is that with fewer jobs, people will travel less.

Bob's picture

Talk your book much?

mikmid's picture

Funking right!!!~

RockyRacoon's picture

Nearly speechless about this strange little rant.  

(Yeah, alert the press, the Coon is speechless.)

The wild assumptions and accusations are maniacal ravings.

GovernmentMule's picture

I have worked in the industry for over 25 years. The reality of the situation is about to come home to you...

I would suggest furthering your education in this area prior to delivering such misinformed condemnations.

RockyRacoon's picture

Hi!  Another expert talking his factless book.  Welcome.

Not being an expert in anything, nor having the fortitude to spend 25 years doing anything other than breathing consistently, I don't pretend to have any answers.  Hell, I don't even know what the real questions are.   But I sure know a propaganda piece when I see one.