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Cantwell, McGavick and oil

Maria Cantwell at an Exxon stationWhat seems undisputed in the contentious world of oil and gas is that we’re running out. The exact moment of peak and decline seems yet to be the subject of some dispute, but evidently by the time we hit two decades or so hence, the United States, and the world, we will have a whole lot less oil to burn.

This leads to an obvious conclusion: Unless we want to de-evolve our society (as most of us do not), we should be getting about the business of developing new technology, so that our cars can run and houses be heated from sources other than petroleum. This is neither a stretch nor unrealistic, and any number of specialists have said that the economic pressure for it happen will occur once gas reaches a certain price point; $5 a gallon is often banied about. That, of course, suggests we have no free will or insight or initaitive to act before then, and simply develop the tech because we can see what’s coming in the future of oil.

That, we’d suggest, is the logical backdrop to the rising political dispute over our spiking gas prices, those being the immediate sympton of a bigger problem. Watch for the rare politician who looks further ahead than this month’s crisis: You may need to go on an expedition to find one.

That doesn’t necessarily invalidate the short-range stuff; it instead puts it in its place. While to one extent or another, the rise in gas prices over the last generation was going to happen and is going to continue, the immediate details are not necessarily irrelevant.

Oil and gas spiked unexpectedly and interestingly in an Oregon Republican gubernatorial debate, and that may be worth revisiting. But nowhere in the Northwest has oil and gas become so central to politics as in the still-emerging Senate race in Washington.

A richly detailed report on this appears in today’s Tacoma News Tribune. In more abbreviated form, a few thoughts . . .

Maria CantwellMaria Cantwell is playing it hard, and for good political reason: Even those Democrats still furious with her about her Iraq war and Alito votes will cheer her on whem it comes to oil company investigations. She can say, accurately, this is not just some election-year issue for her: She was pounding on oil companies last year and earlier. And for the immediate picture, she has a compelling argument that hits home in the Puget Sound.

Her contention is not that a group of oil executives gather in an underground garage at midnight to fix prices. But she does suggest the big companies are leveraging their clout to manipulate the markets, jagging prices higher – artifically – than unavoidable market pressures would make necessary. The argument has some sophistication. It is not that prices logically ought not be high, but rather that they are higher than they need be. She comes up with two external pieces of evidence for this. One is that oil company profits have, in recent months, hit all time record highs, have gone through the roof; if the companies were simply bouncing along with market pressures, passing along external costs, that would not be the case. The other point is that we’ve seen this kind of corporate market menipulation before, and most excruciatingly on the west coast. That happenened in 2000 to 2001 when consumers were told the sudden skyward blast in electric power prices was the result of a systemic shortage, when it turned out to be nothing more than an (Enron-centered) shell game specifically designed to inflate prices. And profits.

The limiting factor in this, of course, is that while it speaks to payback (which would be merited if Cantwell’s suspicions are correct) and some short-term relief in prices, it doesn’t address the overall problem. Gas prices of $4 and $5 and higher are coming, even absent corporate foul play; the only issue is when.

Cantwell is doing the hard-sell on all this; the News-Tribune wire headline is, “Cantwell vs. Big Oil: Photo ops or truth?” But then, the two are not necessarily mutally exclusive.

Mike McGavickHer Republican opponent, Mike McGavick, takes an opposing view, and has a harder case to make. Touring western Washington business groups last week, this was his comment on the petro situation:

“At a very basic level, in the short term, this is a simple supply and demand issue. While we are dependent on oil, we must increase supply, and we must do it domestically. In the past five years, our state has seen no progress at the pump. Investigating possible price gouging by the oil companies is definitely something that should be done, but it certainly isn’t a strategy for increasing supply or bringing down cost in the near future. Unfortunately, this very real issue continues to be treated as a political tool back East. Pointing fingers is not a strategy for solving this problem. Instead, our leaders in D.C. need to focus on making as much progress domestically as possible.”

There’s more than a measure of truth in this; ultimately, the one thing, gas prices are a matter of supply and demand, and they should be treated as something more serious than as this season’s trendy political football.

But taken as a whole McGavick’s view suggests that we can produce our way out of the problem, that we can solve the problem if only we can drill for oil anywhere and everywhere. That’s a problem, because it’s a willful look away from the big delimiter – the ultimate end to our oil supply – which still is out there, and not so far away. Tearing up our public lands in a search for more oil won’t solve the problem in the short term (you need years to get a year substantial supply running from underground through the system and to the pump). But more than that, it won’t solve the problem in the long term either, only buy us two or three more years to feed our petro fix at hyper-prices. What good, really, is that?

But the campaign season is early. We can hope that our debate on oil, a subject that really deserves more thoughtfulness, will evolve as it progresses.

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