Congressional agenda

[cctxfan]

I touched on this yesterday, but had several other thoughts.

I think it would be a great idea for Pelosi and Reid to due a press relase or news conference and say something to the effect that after consulting with President Obama this is the legislative agenda for 2009:

Job creation
Economy recovery
Iraq/Afghanistan
Alternative energy
Health Care
Taxes
Education
Environment
Infrastructure
Military spending

This will be almost entirely what Congress will focus on. Republicans are welcome and encouraged to submit bills and work with Dems and that any legislation adhering to the topics above will get fair consideration with up/down, votes, etc.

HOWEVER, social agenda legislation is OFF THE TABLE. I mean, be up front and honest with the GOP and the American public. There are more important things to focus on than nudity/cursing on TV, gay marriage, and abortion. Abortion is legal and the law of the land as are certain laws that restrict abortion. These kinds of bills are devisive, flame the culture wars, and divert from the serious issues that threaten the very existence of our country. Bills of this nature that are actually filed will be discarded in committee, etc.

Americans want Congress to lead. This would be a good first step to show that they are going to lead and not get caught up in a bunch of BS.

[scout3dave]

I touched on this yesterday, but had several other thoughts.

I think it would be a great idea for Pelosi and Reid to due a press relase or news conference and say something to the effect that after consulting with President Obama this is the legislative agenda for 2009:

Job creation
Economy recovery
Iraq/Afghanistan
Alternative energy
Health Care
Taxes
Education
Environment
Infrastructure
Military spending

This will be almost entirely what Congress will focus on. Republicans are welcome and encouraged to submit bills and work with Dems and that any legislation adhering to the topics above will get fair consideration with up/down, votes, etc.

HOWEVER, social agenda legislation is OFF THE TABLE. I mean, be up front and honest with the GOP and the American public. There are more important things to focus on than nudity/cursing on TV, gay marriage, and abortion. Abortion is legal and the law of the land as are certain laws that restrict abortion. These kinds of bills are devisive, flame the culture wars, and divert from the serious issues that threaten the very existence of our country. Bills of this nature that are actually filed will be discarded in committee, etc.

Americans want Congress to lead. This would be a good first step to show that they are going to lead and not get caught up in a bunch of BS.

That's a great idea, they can focus in on important topics like steroids in baseball and the fairness doctrine!:rolleyes:

Actually I agree with you, and would be the best approach, come up with an agenda like the "Contract with America" and drive it through. But you have some monumental ego's as committee chairmen, just as the pubs did, who are going to want to exert their power. Controlling those guys is what is critical for Obama to be a success.

[jg6544]

I have a hunch that they'll initially concentrate on things tied into the budget process, because they can pass those with simple majorities in the Senate. They need to get a few wins behind them before they start pushing bills that can be filibustered in the Senate.

[cctxfan]

That's a great idea, they can focus in on important topics like steroids in baseball and the fairness doctrine!:rolleyes:

I agree some of that stuff was silly. I think the problem was that although Dems had a majority in Congress, it was too slim in the Senate to push through their agenda. And even if they did, Bush would veto it. While they wanted to end the war in Iraq and push healthcare reform (amongst other things), even with broad support from the American public (not for everything, of course), there was just no way they could do it.

So, they resorted to things they had control over, like digging into steroids and, this was important, the scandals at the Justice Department.

[scout3dave]

I agree some of that stuff was silly. I think the problem was that although Dems had a majority in Congress, it was too slim in the Senate to push through their agenda. And even if they did, Bush would veto it. While they wanted to end the war in Iraq and push healthcare reform (amongst other things), even with broad support from the American public (not for everything, of course), there was just no way they could do it.

So, they resorted to things they had control over, like digging into steroids and, this was important, the scandals at the Justice Department.

Perhaps jg can comment from his experience, but I think a lot of the noise (steroids,etc) that they get into is to mask or give time to delve into deeper problems while the public is distracted. Or maybe they just want to get on TV.

It is interesting to watch C-Span committee "mark up" sessions where they sit around the table and put together the spending bills, I've seen pubs remind dems that this is something they wanted and vice versa. There is a lot more cooperation than any of them want to admit!

[JG]

They should learn the lesson of Clinton. In his first few days, he went ahead and honored his campaign promise to allow gays in the military. The right freaked out, and there was a big media backlash about it. This allowed a divisive social issue to dominate the attention of the country in a time where he was trying to get his feet wet.

There will a lot of people lobbying for this cause or that early next year. The Dems MUST focus on centrist items, such as establishing a timetable for leaving Iraq, taxes, economy, etc. They have to do these things first, then they can come back for the other things. The liberal constituencies will have to understand.

[jg6544]

They should learn the lesson of Clinton. In his first few days, he went ahead and honored his campaign promise to allow gays in the military. The right freaked out, and there was a big media backlash about it. This allowed a divisive social issue to dominate the attention of the country in a time where he was trying to get his feet wet.

And the irony is, no one in the gay community really asked him to make the pledge in the first place, much less make it his first official act as President.

[scout3dave]

They should learn the lesson of Clinton. In his first few days, he went ahead and honored his campaign promise to allow gays in the military. The right freaked out, and there was a big media backlash about it. This allowed a divisive social issue to dominate the attention of the country in a time where he was trying to get his feet wet.

There will a lot of people lobbying for this cause or that early next year. The Dems MUST focus on centrist items, such as establishing a timetable for leaving Iraq, taxes, economy, etc. They have to do these things first, then they can come back for the other things. The liberal constituencies will have to understand.

But he really didn't do that, he equivocated with his "don't ask, don't tell". Which I believe is still in effect, you can not be outwardly gay and stay in. Correct me if I am wrong.

[jg6544]

But he really didn't do that, he equivocated with his "don't ask, don't tell". Which I believe is still in effect, you can not be outwardly gay and stay in. Correct me if I am wrong.


Initially, Clinton told the Chiefs he intended to remove the ban on "out" gay people serving in the military by Executive Order. Their friends on the Hill, Sam Nunn (D-GA) and John Warner (R-VA) threatened to overturn the order by statute if he did, so he asked Secretary of Defense Les Aspin to appoint a commission to study the situation and make recommendations six months later. Aspin wasn't particularly interested in the matter; thought it would get in the way of what he thought were more important things, and he plunged into the effort with the enthusiasm one reserves for a trip to the dentist.

Meanwhile, the 'pubs (who loathed Clinton and never acknowledged the legitimacy of his election or his Presidency) smelled blood in the water and started throwing gas on the fire Nunn and Warner had lit in the Senate Armed Services Committee. They scheduled (very public) hearings.

Aspin's group came back with a pretty bad report outlining the ridiculous "don't ask, don't tell" policy (it's o.k. to be gay in the military as long as you're dishonest about it), which Congress made worse before enshrining it into law. It was an unmitigated disaster for gay people and an even worse one for Clinton. He never fully recovered his credibility after making it crystal clear he would abandon his friends at the drop of an excuse.

[TrueHorn]

I agree some of that stuff was silly. I think the problem was that although Dems had a majority in Congress, it was too slim in the Senate to push through their agenda. And even if they did, Bush would veto it. While they wanted to end the war in Iraq and push healthcare reform (amongst other things), even with broad support from the American public (not for everything, of course), there was just no way they could do it.

So, they resorted to things they had control over, like digging into steroids and, this was important, the scandals at the Justice Department.Or whether Bill Frist can diagnose a brain dead patient for a thousand miles away. Dave's such a hypocrite. :rolleyes:

[cctxfan]

They should learn the lesson of Clinton. In his first few days, he went ahead and honored his campaign promise to allow gays in the military. The right freaked out, and there was a big media backlash about it. This allowed a divisive social issue to dominate the attention of the country in a time where he was trying to get his feet wet.

There will a lot of people lobbying for this cause or that early next year. The Dems MUST focus on centrist items, such as establishing a timetable for leaving Iraq, taxes, economy, etc. They have to do these things first, then they can come back for the other things. The liberal constituencies will have to understand.

In my opinion, they need to get rolling on the health care issue. No doubt this will be made into a social issue by the GOP. They are already calling his plan a single-payer socialist system. Which, of course, is not the case.

The Obama administration is going to have to sell this correctly and make it clear they are not getting rid of private insurance and going to a Canadian or UK model. They are simply trying to expand the current model so that everyone can get health insurance.

[editionshield]

In my opinion, they need to get rolling on the health care issue. No doubt this will be made into a social issue by the GOP. They are already calling his plan a single-payer socialist system. Which, of course, is not the case.

The Obama administration is going to have to sell this correctly and make it clear they are not getting rid of private insurance and going to a Canadian or UK model. They are simply trying to expand the current model so that everyone can get health insurance.


i would prioritize Energy before Health Care. a few reasons:

1) every day which passes without a major effort to get us off of oil gets us further behind in a game that plainly IS the future for energy. it's not a matter of IF we do this, but simply when. so let's get on it ASAP.

2) getting off of oil has probably a higher chance of gaining bipartisan support than any other issue, because of the odd-couple coalition it creates between leftist environmentalists who want to address global warming and rightist militarists who want to stop sending bankloads to opec nations. yes, there's the "drill baby drill" contingent but they're ultimately a minority, and besides they can be placated with some pretty modest and sensible concessions regarding limited domestic drilling.

3) as with gays-in-the-military, learn something from the clintons' failures. the first truly major thing they tried to get done was health care; it went down in flames, in part because health care was such a volatile and controversial issue (and it still is, even though the public is no doubt more receptive to reform after yet another 15 years of wreckage to the system).

i think he has a chance to get health-care done -- though i worry that the torpedoed economy may put that in jeopardy -- but it's not the best place to start. get off the ground with something that's not only seriously urgent but also has a pretty firm coalition/mandate; get that under your belt before tackling the beast that is health-care reform.


and as for the "economy" -- my view is that all these other issues ARE the economy. the stimulus plan is another quick-fix little band-aid and fine if they want to get it thru simply because it can be done quickly, but there are no magic-bullets to reverse the economic woes. wanna fix the economy? 1) stop the war and the hemhorraging of money there; 2) make an apollo-like push for oil-independence which will create jobs and ultimately drive down fuel costs; 3) fundamentally change health care to benefit the bottom line of both individuals (via stable premiums plus realistic prescription-drug costs) and businesses (by freeing them from the huge burdens of providing plans to employees). those are starting-points, at least.

only way to fix the economy is to piece-by-piece rearrange the foundations of all the elements that are dragging it down.

[scout3dave]

i would prioritize Energy before Health Care. a few reasons:

1) every day which passes without a major effort to get us off of oil gets us further behind in a game that plainly IS the future for energy. it's not a matter of IF we do this, but simply when. so let's get on it ASAP.

2) getting off of oil has probably a higher chance of gaining bipartisan support than any other issue, because of the odd-couple coalition it creates between leftist environmentalists who want to address global warming and rightist militarists who want to stop sending bankloads to opec nations. yes, there's the "drill baby drill" contingent but they're ultimately a minority, and besides they can be placated with some pretty modest and sensible concessions regarding limited domestic drilling.

3) as with gays-in-the-military, learn something from the clintons' failures. the first truly major thing they tried to get done was health care; it went down in flames, in part because health care was such a volatile and controversial issue (and it still is, even though the public is no doubt more receptive to reform after yet another 15 years of wreckage to the system).

i think he has a chance to get health-care done -- though i worry that the torpedoed economy may put that in jeopardy -- but it's not the best place to start. get off the ground with something that's not only seriously urgent but also has a pretty firm coalition/mandate; get that under your belt before tackling the beast that is health-care reform.


and as for the "economy" -- my view is that all these other issues ARE the economy. the stimulus plan is another quick-fix little band-aid and fine if they want to get it thru simply because it can be done quickly, but there are no magic-bullets to reverse the economic woes. wanna fix the economy? 1) stop the war and the hemhorraging of money there; 2) make an apollo-like push for oil-independence which will create jobs and ultimately drive down fuel costs; 3) fundamentally change health care to benefit the bottom line of both individuals (via stable premiums plus realistic prescription-drug costs) and businesses (by freeing them from the huge burdens of providing plans to employees). those are starting-points, at least.

only way to fix the economy is to piece-by-piece rearrange the foundations of all the elements that are dragging it down.

There is no quick fix to the energy policy, it is a supply/demand issue. As we see right now, the drop in demand caused by the global financial meltdown has driven down prices. That is one hell of a way to stabilize the price. We all hope this economic downturn is shortlived and as it turns around prices are going back up.

In the long term you have to make structural changes, electric cars and the like, but that will take many years to begin to have an effect. Interim steps like Carter implemented 55 MPH speed limits can have an effect but they are terribly unpopular and does a new administration want to piss off a lot of folks right off the bat.

The shift of consumers $$ to energy from other spending or saving options has been a terrible drag on the economy. Good short term for the energy biz, but long term it isn't good for anyone.

For those that want to keep prices high to discourage use, it still has the dampening effect on other areas of discretionary spending or saving.

Openning drilling in ANWR and offshore US creates jobs and will improve domestic supplies of O&G, 2 big winners, it will just piss off a few environmentalist.

He needs to drive nuclear power for electricity generation, it is the cleanest source of a great deal of energy that can then be used to alter the usage from hydrocarbons to electricity, again this will take years but needs to get started, it will create jobs, but piss off a few enviros, a very fair political tradeoff!

Whatever he does, he needs to be careful not to over reach, don't try and do more than one big thing, and maybe a couple of little things. From what I read about the backroom dealing with the Clintons when they tried to take on the health care industry, they could have been successful in taking pieces of the puzzle and getting things done, but they were stubborn and wanted the whole banana, and they lost everything in the initiative including Congress.

[austinr]

If health care can be addressed immediately that would solves some other problems. The US Auto Makers spend more money on employees health care than they do on Steel. Health Insurance Premiums are backrupting families and other types of business's. The universal health care would solve several problems on that "focus" list.

[jg6544]

If health care can be addressed immediately that would solves some other problems. The US Auto Makers spend more money on employees health care than they do on Steel. Health Insurance Premiums are backrupting families and other types of business's. The universal health care would solve several problems on that "focus" list.

Again, he has to focus first and foremost on the economy and in efforts that can be done in the context of the Congressional budget process to take away the filibuster in the Senate. Once he's got some victories behind him and economic recovery is at least contemplatable, then he should move on other issues such as health care.

[TrueHorn]

There is no quick fix to the energy policy, it is a supply/demand issue. As we see right now, the drop in demand caused by the global financial meltdown has driven down prices. That is one hell of a way to stabilize the price. We all hope this economic downturn is shortlived and as it turns around prices are going back up.

In the long term you have to make structural changes, electric cars and the like, but that will take many years to begin to have an effect. Interim steps like Carter implemented 55 MPH speed limits can have an effect but they are terribly unpopular and does a new administration want to piss off a lot of folks right off the bat.

The shift of consumers $$ to energy from other spending or saving options has been a terrible drag on the economy. Good short term for the energy biz, but long term it isn't good for anyone.

For those that want to keep prices high to discourage use, it still has the dampening effect on other areas of discretionary spending or saving.

Openning drilling in ANWR and offshore US creates jobs and will improve domestic supplies of O&G, 2 big winners, it will just piss off a few environmentalist.

He needs to drive nuclear power for electricity generation, it is the cleanest source of a great deal of energy that can then be used to alter the usage from hydrocarbons to electricity, again this will take years but needs to get started, it will create jobs, but piss off a few enviros, a very fair political tradeoff!

Whatever he does, he needs to be careful not to over reach, don't try and do more than one big thing, and maybe a couple of little things. From what I read about the backroom dealing with the Clintons when they tried to take on the health care industry, they could have been successful in taking pieces of the puzzle and getting things done, but they were stubborn and wanted the whole banana, and they lost everything in the initiative including Congress.
There is a quick and easy fix to oil prices and we are seeing it right now, conservation. Replace the gas guzzles with hybrids and PHEVs and oil prices with be back down below $100. That will buy time to shift to biofuels and some of them look like they will be very attractive. We need to put in place a federal tax that keeps gas at the pump in the $2.50-3.00 range and correct the impact on the poor with other programs. We need to have the oil companies pay for our military presence in the Middle East, it's for them that we are there.

Nuclear power will have a very slow and long road to re-emergence in this country. The thing holding it back is the board of directors at the nuclear companies. All they need to do is step up and write the check for $9 Billion. =))

Renewable energy is the only sustainable path. We need to get on with it. You don't solve a drug addiction by finding a cheaper source of drugs. The oil era is ending.

[austinr]

Again, he has to focus first and foremost on the economy and in efforts that can be done in the context of the Congressional budget process to take away the filibuster in the Senate. Once he's got some victories behind him and economic recovery is at least contemptible, then he should move on other issues such as health care.

I guess that is what I am saying the economy and health care are tied together especially the Auto Industry. Why do you think the Governor of Michigan is seen at every economic meeting. For the sake of argument what if the Health Care cost became a tax credit instead of a deduction? That was a part of Dick Gepharts proposal in 2004. That would go a long way to solving the problems of the Auto Industry.

[cctxfan]

Scout, investing in alternative energy and nuclear power (which I support) will create many more jobs than offshore or ANWR drilling.

That drill here, drill now slogan is just a way to hype up the GOP base. Nothing more.

[editionshield]

>>
There is no quick fix to the energy policy,
>>


generally speaking i agree about this -- and that's another reason i think it urgently needs #1-prioritization, because it's gonna take awhile to rebuild the foundation, and we need to get started ASAP. actually we needed to get started many years ago but it wasn't gonna happen with an oilman in the white house.

had we been smart about this, we'd already have a huge head-start toward the long-term solution. as it is, we've got a lotta catching up to do. ergo, put it at the top of the agenda.

[edit: to be fair, the foundation should've been in the process of being laid well before bush's two terms. that said, no doubt we'd have had significant action on this in a gore white house.]

[scout3dave]

Scout, investing in alternative energy and nuclear power (which I support) will create many more jobs than offshore or ANWR drilling.

That drill here, drill now slogan is just a way to hype up the GOP base. Nothing more.

We need to do it all, this close minded anti oil BS is as much sloganeering as anything the dems put out.

That being said, I would like to see BO push for an end to the battle over building nuclear and get on down the road.

[scout3dave]

There is a quick and easy fix to oil prices and we are seeing it right now, conservation. Replace the gas guzzles with hybrids and PHEVs and oil prices with be back down below $100. That will buy time to shift to biofuels and some of them look like they will be very attractive. We need to put in place a federal tax that keeps gas at the pump in the $2.50-3.00 range and correct the impact on the poor with other programs. We need to have the oil companies pay for our military presence in the Middle East, it's for them that we are there.

Nuclear power will have a very slow and long road to re-emergence in this country. The thing holding it back is the board of directors at the nuclear companies. All they need to do is step up and write the check for $9 Billion. =))

Renewable energy is the only sustainable path. We need to get on with it. You don't solve a drug addiction by finding a cheaper source of drugs. The oil era is ending.

I addressed our current downturn in oil prices ( a global recession) and if that is your solution, you aren't going to get many supporters.

Last I checked the oil companies don't consume all that much oil, the consumers of the world do.

Nuclear power could very well take off with the proper incentives, and getting the f'n lawyers off their ass.

Renewables are certainly a part of the equation, but they aren't significant when you are talking fluid fuels, electricity makes the most sense and the most efficient, cost effective, and cleanest is nuclear.

[TrueHorn]

I addressed our current downturn in oil prices ( a global recession) and if that is your solution, you aren't going to get many supporters.Funny what I said was "conservation." Reduce demand, however you do it and the price drops precipitously. Again it is what I've said for well over a year on here. The suggestion that drilling is the solutions id just oil industry propaganda. You are as morally corrupt as a crack cocaine dealer.


Last I checked the oil companies don't consume all that much oil, the consumers of the world do.Blame the victim after you've stacked the deck. Typical.


Nuclear power could very well take off with the proper incentives, and getting the f'n lawyers off their ass.Why do we need more incentives for a technology that is 50 years old. Have you even looked at how much of DOE's budget is spent on nuclear power? Have you calculated the value of the Price Anderson Act. You're pathetic, you come from the most subsidized industry in the world and what you want is more subsidies for mature technologies. Stupid policy. Please cite any nuclear plant being blocked by lawyers. My count is zero. Liar liar pants on fire.


Renewables are certainly a part of the equation, but they aren't significant when you are talking fluid fuels, electricity makes the most sense and the most efficient, cost effective, and cleanest is nuclear.Renewables are a part of the solution, they are the only long-term sustainable solution. Everything else is a waste of money.

Bio Fuels hold enormous potential. We need to break the anti-renewable bias the millions of payoffs by the oil industry buys. Oil doesn't look so cheap when you add the cost of the Iraq War to our imports.

[scout3dave]

Funny what I said was "conservation." Reduce demand, however you do it and the price drops precipitously. Again it is what I've said for well over a year on here. The suggestion that drilling is the solutions id just oil industry propaganda. You are as morally corrupt as a crack cocaine dealer.


Blame the victim after you've stacked the deck. Typical.


Why do we need more incentives for a technology that is 50 years old. Have you even looked at how much of DOE's budget is spent on nuclear power? Have you calculated the value of the Price Anderson Act. You're pathetic, you come from the most subsidized industry in the world and what you want is more subsidies for mature technologies. Stupid policy. Please cite any nuclear plant being blocked by lawyers. My count is zero. Liar liar pants on fire.


Renewables are a part of the solution, they are the only long-term sustainable solution. Everything else is a waste of money.

Bio Fuels hold enormous potential. We need to break the anti-renewable bias the millions of payoffs by the oil industry buys. Oil doesn't look so cheap when you add the cost of the Iraq War to our imports.


Unfortunately you lose the dialogue with the "quote " function.

Anyway, I never said drilling was the answer. Strawman

Facts are facts, the world runs on hydrocarbon driven fuel, it has been the cheapest and most available solution to this point. The world demand however is outstripping supply, so prices are going up.

Why do you want to incentivize anything, to promote it, whether that be nuclear or wind, that is pretty basic. The entire DOE budget is about 24 bn, most of which is dealing with defense issues.

Renewables are part of the solution, I have said that. Nuclear is a much more realistic option for providing a cost effective high volume of energy.

The value of the Price Anderson Act? Well I guess the cost to the tax payers has been what -Nothing?

[cctxfan]

Facts are facts, the world runs on hydrocarbon driven fuel, it has been the cheapest and most available solution to this point. The world demand however is outstripping supply, so prices are going up.

Demand is not outstripping supply. That wasn't even the case when oil was at $147 per barrel.

[scout3dave]

Demand is not outstripping supply. That wasn't even the case when oil was at $147 per barrel.

Really? Care to elaborate?

[TrueHorn]

Unfortunately you lose the dialogue with the "quote " function.

Anyway, I never said drilling was the answer. Strawman

Facts are facts, the world runs on hydrocarbon driven fuel, it has been the cheapest and most available solution to this point. The world demand however is outstripping supply, so prices are going up.Now would be a great time to reduce demand.

Why do you want to incentivize anything, to promote it, whether that be nuclear or wind, that is pretty basic. The entire DOE budget is about 24 bn, most of which is dealing with defense issues. To level the playing field for all the breaks the oil industry gets. One good step would be to have the oil comapnies pay for our Middle East military presences. I notice you never commented on that.

Renewables are part of the solution, I have said that. Nuclear is a much more realistic option for providing a cost effective high volume of energy.NO, renewables are the solution. Nothing else is sustainable. Nuclear can get started whenever it wants. The only thing that's holding it back is the willingness of the private sector to put up the money. You are proposing that this be done with private sector money, right?

The value of the Price Anderson Act? Well I guess the cost to the tax payers has been what -Nothing?Then the cost of dropping it will be notherg. Let's drop it. You agree?

[cctxfan]

Really? Care to elaborate?

If demand were outstripping supply, why didn't we see any gas shortages? Where were all the gas stations with no gas. There was plenty of oil. Sure, there were long lines and problems in the SE after Hurricane Ike, but that didn't have anything to with oil, it had to do with refineries going off-line in Ike's wake.

Demand is certainly not outstripping supply now - OPEC is cutting production.

Oil was at $147 due to speculation. Demand dropped slightly, investors looked at the slowing economy, and got out of oil fast. The amount the demand lowered did not justify oil prices crashing by 50%.

[TrueHorn]

If demand were outstripping supply, why didn't we see any gas shortages? Where were all the gas stations with no gas. There was plenty of oil. Sure, there were long lines and problems in the SE after Hurricane Ike, but that didn't have anything to with oil, it had to do with refineries going off-line in Ike's wake.

Demand is certainly not outstripping supply now - OPEC is cutting production.

Oil was at $147 due to speculation. Demand dropped slightly, investors looked at the slowing economy, and got out of oil fast. The amount the demand lowered did not justify oil prices crashing by 50%.CC in a functioning market, demand and supply are balanced with price rationing. It's only during disruptions where you expect there to be physical shortages The gas lines in the 70s were much more a case of panic buying by the public than a real shortage. People started trying to keep their fuel tanks 3/4+ full rather than running down to empty before buying gas. That moved a huge slug of inventory from the station to fuel tanks. In addition people were stopping to buy more often. Instant "at the pump" shortage.

What's happened is demand growth has absorbed essentially all the excess lifting capacity in the world's oil fields and price has responded. Now that people are conserving again, price is dropping. Notice the relationship.

http://tonto.eia.doe.gov/dnav/pet/hist_chart/WTOTWORLDw.jpg


http://tonto.eia.doe.gov/dnav/pet/hist_chart/WTTIMUS2w.jpg

[cctxfan]

CC in a functioning market, demand and supply are balanced with price rationing. It's only during disruptions where you expect there to be physical shortages The gas lines in the 70s were much more a case of panic buying by the public than a real shortage. People started trying to keep their fuel tanks 3/4+ full rather than running down to empty before buying gas. That moved a huge slug of inventory from the station to fuel tanks. In addition people were stopping to buy more often. Instant "at the pump" shortage.

What's happened is demand growth has absorbed essentially all the excess lifting capacity in the world's oil fields and price has responded. Now that people are conserving again, price is dropping. Notice the relationship.

True, my point was demand for oil at the peak price of $147 per barrel did not justify that price and demand was not outstripping supply. Was demand tight? Yes. Do demand and price correlate linearly? No. I agree that a 10% reduction in demand will probably mean more than a 10% reduction in price.

I know you've stated in the past your belief that the high price of oil was largely set by demand, not by speculation. But I don't find that's the case. In July when oil hit it's peak of $147, global demand was actually less than it was when oil was trading at $80 a barrel 9-12 months before because the global economy had already been slowing.

Furthermore, you've got economists, investment experts, and oil producers all saying speculation was driving up prices. The only ones saying demand was the sole justification for prices were the investment institutions and commodity traders who make a living off trading oil. I'll stick with the former group.

[TrueHorn]

True, my point was demand for oil at the peak price of $147 per barrel did not justify that price and demand was not outstripping supply. Was demand tight? Yes. Do demand and price correlate linearly? No. I agree that a 10% reduction in demand will probably mean more than a 10% reduction in price.

I know you've stated in the past your belief that the high price of oil was largely set by demand, not by speculation. But I don't find that's the case. In July when oil hit it's peak of $147, global demand was actually less than it was when oil was trading at $80 a barrel 9-12 months before because the global economy had already been slowing.

Furthermore, you've got economists, investment experts, and oil producers all saying speculation was driving up prices. The only ones saying demand was the sole justification for prices were the investment institutions and commodity traders who make a living off trading oil. I'll stick with the former group.Absent a tight supply/demand relationship, speculators can't hope to affect price. The root cause is a tight market. The ultimate solution is demand reduction. You can't stop speculation, overall it's not necessarily bad. Fix the fundamental problem is what I'm really saying.

[cctxfan]

Absent a tight supply/demand relationship, speculators can't hope to affect price. The root cause is a tight market. The ultimate solution is demand reduction. You can't stop speculation, overall it's not necessarily bad. Fix the fundamental problem is what I'm really saying.

That's a fair point. So, tight markets invite speculation. If true, I guess speculators largely absent during the tight markets of 2007 which explains significantly lower prices then.

But that also doesn't disprove my point that speculators were driving up prices (by inflaming an already tight market).

[TrueHorn]

That's a fair point. So, tight markets invite speculation. If true, I guess speculators largely absent during the tight markets of 2007 which explains significantly lower prices then.

But that also doesn't disprove my point that speculators were driving up prices (by inflaming an already tight market).Speculation is always there in slack and tight markets. You can model (and I've done this) price behavior in the energy markets. Most of the time price is quite close what you would expect from economics. When supply and demand relationships get tight, however, you enter an area of instability where price can be very volatile. You can't model it and it could bounce around quite a bit. Blame it of speculation, or just attribute it to the way these markets behave. I think it's endemic. I also think that there's some desire to have villains. If all the "speculator" does is take a long position on a commodity, which then increases in price, what is the transgression?

[cctxfan]

If all the "speculator" does is take a long position on a commodity, which then increases in price, what is the transgression?

In pure and unabated capitalism, there is nothing wrong with it. But when you have forces that collude to drive up prices, that's another story.

Speculators, by in large, aren't actually purchasing the product for delivery. Thus they don't commit the sin of hoarding and sitting on a commodity to drive up prices. Doesn't the diamond market work this way?

However, when you get tons of speculators putting in money hoping for the price to go up, it most certainly will. In effect, they are artificially driving up the real value of the product. And in this case it has global repercussions. You can, of course, argue that the real value is what someone is willing to pay for something, regardless of how the price was arrived at - pure capitalism Fine. But we as a society place limits on capitalism to prevent inflation of a good or service beyond what would be considered normal demand. In strict capitalism, what's wrong with a monopoly? They use their resources to gain complete control over a commodity or service and they thus have complete control to manipulate the price of such goods. But we as a society long ago deemed monopolies as capable of doing great harm to our free-market economy and anti-trust laws were put in place.

If the world thinks that oil speculation is doing more harm than good and inflating the price well above the price actual demand would set, why is bad to put similar laws in place?

[scout3dave]

In pure and unabated capitalism, there is nothing wrong with it. But when you have forces that collude to drive up prices, that's another story.

Speculators, by in large, aren't actually purchasing the product for delivery. Thus they don't commit the sin of hoarding and sitting on a commodity to drive up prices. Doesn't the diamond market work this way?

However, when you get tons of speculators putting in money hoping for the price to go up, it most certainly will. In effect, they are artificially driving up the real value of the product. And in this case it has global repercussions. You can, of course, argue that the real value is what someone is willing to pay for something, regardless of how the price was arrived at - pure capitalism Fine. But we as a society place limits on capitalism to prevent inflation of a good or service beyond what would be considered normal demand. In strict capitalism, what's wrong with a monopoly? They use their resources to gain complete control over a commodity or service and they thus have complete control to manipulate the price of such goods. But we as a society long ago deemed monopolies as capable of doing great harm to our free-market economy and anti-trust laws were put in place.

If the world thinks that oil speculation is doing more harm than good and inflating the price well above the price actual demand would set, why is bad to put similar laws in place?


It was supply and demand that pushed prices up, speculators may have added some fuel to the fire, but historically as demand approaches supply, within around 4 MM BPD, prices react. When that turns around by a drop in consumption, prices fall. The oil business has been cyclical since it's inception.

Are the prices too low now because of speculators? Who knows?

[cctxfan]

It was supply and demand that pushed prices up, speculators may have added some fuel to the fire, but historically as demand approaches supply, within around 4 MM BPD, prices react. When that turns around by a drop in consumption, prices fall. The oil business has been cyclical since it's inception.

Are the prices too low now because of speculators? Who knows?

Many economists, investment guru's, and the oil industry disagree with you.

[TrueHorn]

In pure and unabated capitalism, there is nothing wrong with it. But when you have forces that collude to drive up prices, that's another story.Outside the US collusion is not necessarily a crime. If you find someone in the US that is colluding you should throw them in jail. What do you do about the Dutch?

Speculators, by in large, aren't actually purchasing the product for delivery. Thus they don't commit the sin of hoarding and sitting on a commodity to drive up prices. Doesn't the diamond market work this way?They can still bid up the market. There are typically 5-10 times as many financially settled contracts as there are physical contracts on any given commodity.

However, when you get tons of speculators putting in money hoping for the price to go up, it most certainly will. In effect, they are artificially driving up the real value of the product. And in this case it has global repercussions. You can, of course, argue that the real value is what someone is willing to pay for something, regardless of how the price was arrived at - pure capitalism Fine. But we as a society place limits on capitalism to prevent inflation of a good or service beyond what would be considered normal demand. In strict capitalism, what's wrong with a monopoly? They use their resources to gain complete control over a commodity or service and they thus have complete control to manipulate the price of such goods. But we as a society long ago deemed monopolies as capable of doing great harm to our free-market economy and anti-trust laws were put in place.You can prove that a monopoly causes an inefficient allocation of resources. With speculators what I think you can demonstrate is that they cause markets to be more volatile than they would otherwise be. Over the long run they bid out market inefficiencies. I think there need to be some restrictions on speculation, but don't agree with eliminating it.

If the world thinks that oil speculation is doing more harm than good and inflating the price well above the price actual demand would set, why is bad to put similar laws in place?Without speculators as counter parties, hedging would be much more difficult and expensive,.

[TrueHorn]

Many economists, investment guru's, and the oil industry disagree with you.
One of the rare moments when I pretty much agree with Dave.