Stop bashing Exxon-Mobil

Exxon-Mobil has become the target for almost every politician, and the oil industry has become the number one scapegoat as the cause for high gasoline and diesel prices. The other American oil companies are also in the crosshairs, but as Exxon-Mobil is the largest oil enterprise in America, it is the easiest one to attack. In terms of worldwide corporate oil giants, Exxon-Mobil is not even in the top 10. An avant-garde attitude in our country is that any large profitable business has achieved its results by deceiving the consumer.

Our domestic oil companies are not siphoning crude from our native ground at minimal cost and selling the refined product at an enormous profit. This is far from the truth as in the scheme of worldwide oil companies, Exxon-Mobil along with the other American oil companies control only a small fraction of the global reserves.

As a comparison, Wal-Mart, also often accused of villainous behavior, is currently the largest corporation in America and yet it doesn’t produce anything. It is a marketer and has attained its success through a sophisticated, ever-evolving logistics system that includes container traffic from overseas, domestic and international road and rail, warehousing and distribution. This is clearly the direction all of our oil companies are taking as they evolve into refiners and marketers and are no longer in control of ample feedstock (crude oil) to supply America’s needs. Every tanker of oil, gasoline and diesel brought to the U.S. has been purchased from a foreign supplier at competitive world market prices. Oil trading is very much like an auction and our price at the pump is relative to the world’s demand for fuel and not just our own.

Foreign oil companies are permitted to operate freely in America and they make substantial profits in our backyard. At the next replenishment one should remember that BP is British, Shell is Dutch, Total is French, Lukoil is Russian, and CITGO, recently renamed Petro-Express is owned by the Venezuelan government. As a reminder, it was the current President of Venezuela, Hugo Chavez and the Venezuelan government that expropriated Exxon-Mobil’s oil producing facilities in 2007 valued at $12 billion, resulting in an ongoing law suit.

The United States has about 5% of the world’s population and we have consistently been consuming 25% of the world’s energy. In the case of any excesses, eventually reality comes home to roost. Cheap energy is no longer an entitlement and fossil fuels will eventually have to be replaced.

Unfortunately, the rest of the world, especially the emerging markets have used the same American economic model as a foundation on which to build their domestic economies. The demand for all energy sources has never been greater and supplies have never been more stretched. This applies to coal and natural gas, not just to crude oil. As an example of the demand curve, China is expecting to have over 100 million cars on the road by 2020. The Chinese are building coal-fired power plants at the rate of one new facility every 10 days to generate enough electricity for industrial use, domestic and consumer demand. China is only one country within a basket of emerging economies. It is no surprise the price of coal has gone up 6 to 10 times within the last 5 years.

There is no simple solution, but a many pronged approach would seem logical. For those against domestic drilling on environmental grounds, if we do not drill domestically we may be preserving our own environment but more than likely we’ll be contributing to the despoliation of a foreign environments, especially in places that have no safeguards. We can either control exploration and domestic production with sensible regulations, or we can continue to import and turn a blind eye to the environmental damage done in other countries. Developing potential domestic sources will not have an impact on our current gas prices, but it will take decades for the use of fossil fuel to diminish and having a controlled supply is not just a matter of national security, but it is common sense.

At the same time, conservation must be encouraged and energy-friendly housing and commercial buildings must be mandated. Congress must reenact substantial tax credits for research, development and use of alternative energy sources, and new nuclear facilities should not be tied up for decades in court. Public transportation should be created or improved within all the major American cities through a program similar to the construction of our nation’s interstate highway system during the Eisenhower administration. Or we can do nothing except blame Exxon-Mobil for our own inability and that of our government to take the urgent steps by forming and enacting a cohesive energy policy. This is a crisis that will not be remedied with a Band-Aid, a tax holiday, a modification to futures trading or a windfall profit tax. It simply requires some forward thinking from legislators who are always reluctant to tell their constituents the truth or embark on programs that may not have seemingly immediate positive results.

 

 

Recycling

Kudos to our small but dedicated group of citizens who have brought recycling to our tiny community. Although a bit short on ambience, the bins adjacent to the Search and Rescue facility have become the new social gathering place in town. One meets friends and like-minded people, and conversation is easy against the background of smashing bottles inside of the metal receptacles. I usually am a bit embarrassed about my collection of empty whiskey bottles, but I tell everyone they are from my neighbors and I am simply the carrier.

It would seem the burden of collecting empty beer, wine bottles and aluminum cans could easily be streamlined with a 25 cent return deposit on each item. For those of my generation, collecting pop and beer bottles and returning them to the grocery store for 2 cents each was a weekend money-making routine.

The beer and soft drink manufacturers have fought this idea within the Beltway for decades. Adding an extra $1.50 to a six pack might make their product unaffordable. They are confrontational about the fact that a deposit is returnable by the user and is a loan, not an expense. As one who cleans my nearby highway apron several times each year, it would be delightful not to fill numerous orange trash bags with glass and metal containers, but instead to have the user return them religiously to a supermarket to recapture their deposit. The supermarket chains and convenience stores are also adversaries to this idea as it would require some equipment and extra storage space. In this era of rising energy prices, the public should be aware that only a fraction of power is required to convert aluminum cans back to a usable product and the same applies to recycled glass and paper.

Another avenue for saving time and energy is the catalog business. It is annoying that I receive certain catalogs by mail on a monthly basis and that is the result of a random order I placed at least five years earlier. Each catalog should have a prepaid postage card so that the catalog recipient can mail the card back and ask to be removed from the company’s mailing list. Another box could be checked requesting that your mailing information is not sold to another catalog company.

This would not only save trees and the energy required to convert cellulose to paper, but it would save fuel consumption by the Post Office. The basic formula for a passenger car is that for every 100 pounds of extra weight, the car’s mileage decreases about 2%. If several hundred thousand Post Office vehicles have less weight to carry, the amount of gas or diesel saved in a year would be enormous. This seems to be a simple way to save trees and energy along with the time, money and effort required to dispose of needlessly received catalogs.

Most of our recyclable material remains in the United States and is put to good use, but a huge amount of waste is also sent to foreign markets. With the excess capacity of empty shipping containers that must be returned to the Far East, an enormous trade has developed sending bales of used cardboard, compressed plastic bundles and scrap metal to overseas recyclers. Scrap and waste material is now one of our leading export commodities. This is a healthy and earth-preserving formula to ensure that items previously destined for our landfills and incinerators find their way back to our households. Your neighbor’s discarded refrigerator could easily have been reincarnated as the microwave now sitting in your kitchen.