Kudlow: Bush Says Drill, Drill, Drill — and Oil Drops $9!

Larry Kudlow speaks truth to those who would have ears to listen.

In a dramatic move yesterday President Bush removed the executive-branch moratorium on offshore drilling. Today, at a news conference, Bush repeated his new position, and slammed the Democratic Congress for not removing the congressional moratorium on the Outer Continental Shelf and elsewhere. Crude-oil futures for August delivery plunged $9.26, or 6.3 percent, almost immediately as Bush was speaking, bringing the barrel price down to $136. […]

Traders took a look at a feisty and aggressive George Bush and started selling the market well before a single new drop of oil has been lifted. What does this tell us? Well, if Congress moves to seal the deal, oil prices will probably keep on falling. That’s the way traders work. They discount the future. Psychology and expectations can turn on a dime.

This is why if we start allowing drilling now it will lower prices now. The function of the free market is to adjust today’s prices to what tomorrow’s prices are expected to be, and so on well out into the future.

The reasons for high gas prices in the US now are twofold (as I see it).

  1. Inflation has weakened the dollar while the value of oil has stayed steady or risen. For proof, look at the price of gold for a constant measure of value and compare to what oil has done.
  2. Twenty years ago the US produced more of its own oil than it does today, 60%-70% as compared to 40% today. Environmental limits on drilling and refining, profit plundering by excessive taxation, and a litigious climate have prevented new wells and new technologies while doing their best to shut down old ones.

In a related story concerning the free market and what it means, Bush yesterday lectured reporters on why calls for conservation would not be forthcoming from him.

“They’re smart enough to figure out whether they’re going to drive less or not. I mean, you know, it’s interesting what the price of gasoline has done,” Bush said at a news conference in the White House press room, “is it caused people to drive less. That’s why they want smaller cars: They want to conserve. But the consumer’s plenty bright. The marketplace works.”

“You noticed my statement yesterday, I talked about good conservation and — you know, people can figure out whether they need to drive more or less,” he said. “They can balance their own checkbooks.”

That’s the free market. Based on a respect for the intelligence of crowds, it understands that like a busy freeway that functions safely and smoothly most of the time (excepting mechanical failures, police or construction obstructions, and drunkenness), guided by the self-interest of the individual drivers, the free market will function safely and smoothly most of the time, except for those times when the free market is prevented from working by the government grant of a monopoly. The government is the source of all monopolies, because only the government has the right to force a person (customer, employer, or employee) to do something at the point of a gun. And that is the essence of monopoly.

In other words, we can drill our way out of this mess. Congressional Democrats needs to loosen the noose on American oil resources and just give Americans a chance to show what they can accomplish.

Your thoughts?


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Obama’s red diaper baby background

Frank Marshall Davis, Barack Obama’s first mentor, wrote these lines:

Smash on, victory-eating Red warriors!
Show the marveling multitudes
Americans, British, all your allied brothers
How strong you are
How great you are
How your young tree of new unity
Planted twenty-five years ago
Bears today the golden fruit of victory!

Drive on, oh mighty people’s juggernaut!
Hear in your winning ears
Shadow songs of your departed comrades
Telling you, “Be avengers and kill our killers
And when you have struck the last foe to the ground
Then drop their fascist dreams below hell!”

He was the third of many haters of America upon whom Obama modeled himself. The first was his own mother, an American expat social worker who roamed the world to find exotic, anti-American men to marry. The second was his own father, a socialist, ex-Muslim atheist, African Arab from Kenya named Barack Hussein Obama who abandoned his son’s mother and moved back to his first wife in Kenya, only to wrap himself around a tree in a drunk driving accident before his son could ever come to know him well.

Obama’s beginnings were tragic, the stuff of a Dickens plot. But it is his now and next that concerns American voters. For what does he stand? He has the most liberal, party-line voting record in the US Senate. Yet he claims to be a centrist. His promises do not match his record. He has voted against an Illinois state law protecting babies who survive their own abortion from being legally killed after delivery, yet he claims he is not dogmatic in his pro-abortion stance. He wants to decimate the US military, promote paid volunteerism for college students (I can’t figure that out either, but I think it has something to do with his first career after law school as a paid community organizer), and invade Pakistan, while ruling out military threats against Iran. He proposes even more new spending than Hillary Clinton, who famously stated about her budget plans for the U.S.: “I have a million ideas. The country can’t afford them all.” [Boston Globe] And to Obama, every problem is an opportunity for government to step into the breach. There are no problems that can be handled by private citizens working alone or cooperatively. To Obama, everything is a reason to increase government reach and spending. And though he does not consciously identify with the Communist Party, many policies he favor are congruent with what the Communists believe. Compare the plans on his website to the goals on the CPUSA site.

Even if he is not a communist, can the US afford to have a President whom the communists are so happy to imagine in the Oval Office? Finish reading Andrew Walden’s article and think it over. I know I will be doing so.


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Title IX’s faults

Alison Kasic (a chica, not a chico) writes at the CS Monitor regarding the aftereffects of Title IX.

When Title IX was being debated in Congress at its inception, several sponsors assured their fellow members that the bill would not be used to promote gender quotas. Sen. Birch Bayh said that such quotas were “exactly what this amendment intends to prohibit.” Quotas might not have been intended for the original law, but, in effect, were later added by government bureaucrats.

The original law simply states: “No person in the United States shall, on the basis of sex, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any education program or activity receiving Federal financial assistance.”

That’s where it started. And in a perfect storm of red tape, the Education Department has implemented regulations that enforce strict gender quotas in athletics and is threatening math and science programs in which males outperform females.

Read it all.


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Too many people are going to college

So says Charles Murray in his new book, Real Education. Actually that is one of four truths upon which he bases his argument. Here are all four.

Ability varies. Children differ in their ability to learn academic material. Doing our best for every child requires, above all else, that we embrace that simplest of truths. America’s educational system does its best to ignore it.

Half of the children are below average. Many children cannot learn more than rudimentary reading and math. Real Education reviews what we know about the limits of what schools can do and the results of four decades of policies that require schools to divert huge resources to unattainable goals.

Too many people are going to college. Almost everyone should get training beyond high school, but the number of students who want, need, or can profit from four years of residential education at the college level is a fraction of the number of young people who are struggling to get a degree. We have set up a standard known as the BA, stripped it of its traditional content, and made it an artificial job qualification. Then we stigmatize everyone who doesn’t get one. For most of America’s young people, today’s college system is a punishing anachronism.

America’s future depends on how we educate the academically gifted. An elite already runs the country, whether we like it or not. Since everything we watch, hear, and read is produced by that elite, and since every business and government department is run by that elite, it is time to start thinking about the kind of education needed by the young people who will run the country. The task is not to give them more advanced technical training, but to give them an education that will make them into wiser adults; not to pamper them, but to hold their feet to the fire.

The universality of college is based in the Supreme Court’s Griggs and Albermarle decisions against testing job applicants. Requiring a college degree sorts out a certain number of “unacceptable” job candidates just as pre-employment testing once did (and a watered-down college degree is an even more questionable requirement for many jobs than a high school degree was in the original Griggs case). The appearance of this book and the reaction to it promises to be a good show.

And it promises to be more than spectator sport. It may influence home education as well. Tom Wolfe blurbs the book on Amazon:

“Charles Murray is one professional contrarian who cannot be written off–not since his first book, Losing Ground, led to a complete restructuring of America’s welfare system. At first Real Education, with its plan for identifying “the elite,” may strike you as an elaboration of his hotly contested views on IQ. But suddenly–swock!–he pops a gasper: a practical plan for literally reproducing, re-creating, a new generation of Jeffersons, Adamses, Franklins, and Hamiltons, educated, drilled, steeped, marinated in those worthies’ concern for the Good and Virtuous with a capital V–nothing less than an elite of Founding Great-great-great-great-great Grandchildren.”

—Tom Wolfe

That would be spectacular!


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