The Price of Gas, and a Reasonable Man.

Someone named Winghunter, called me Stevey and referred to my post, “Gas Prices Go Up Under Obama. Really?” (sic) with disdain, citing about 10 stories relating to the Obama Administration’s efforts to stop drilling for oil here in this country, and his opposition to the pipeline project which would of course, “create tens of thousands of jobs.”  He then assumed I am a left wing radical and closed his rant with “not expecting to hear from you” or something along those lines. Well, Winghunter, you SHOULD expect to hear from me,  and here it is.

To your surprise, I am not a left wing radical. I am actually a capitalist and a member of the 1% club. I voted for Reagan, Bush, Bush and Obama

I voted for Obama because he is a reasonable person (as my partner Tim Handley would say) and a really cool guy. This was after 8 years of being embarrassed by a really un-cool guy. I voted for Reagan and the Bush’s because I thought they were the best chance I had at protecting my earnings and keeping the tax rate the lowest. I was right. And, I was wrong.

I was raised in an Irish Catholic and Jewish household by parents who couldn’t be more opposed when it comes to politics and business. My Mother had worked hard at being a secretary to officers of the US Navy and finished her career as secretary to the base commander at Hunter’s Point Naval Shipyard in San Francisco. She was a self-described Jew, daughter of Hungarian immigrants, a conservative Democrat and capitalist. My father was the 12th child of Irish-Catholic immigrants, drove Yellow Cab in San Francisco for 38 years, was a Teamsters Union steward and thought of himself as a liberal Democrat. From the time I was old enough to remember, we had animated discussions over dinner, about politics, race, religion, taxes, education and movies.

My Father hung with a group of guys who drove cab like him. French, Irish, Albanian, Italian, Spanish, Portuguese and Greek. No African-Americans allowed. They drank and smoked and shot pool and mostly liked working the night shift. My Mother hung with me. I grew up thinking that she was mostly right and he was mostly wrong.

I attended a Catholic elementary school (Our Lady of Angels) and a Catholic High School (Junipero Serra). I met my first African American at UC Berkeley. My Mother held a severely racist view of African Americans based on her experience managing “Negroes” at Hunter’s Point. She didn’t like Italians much better, and we never ate “Italian food”. Whether her stories were true or not, I walked out into life with roughly the same prejudicial inclination. It took ten years for me to lose the prejudice. I think I was lucky.

Somehow, my high school girlfriend became impregnated, so I had to turn down an appointment to the US Naval Academy that my Mother had worked hard to get me, and marry her. This did not make my Mother happy. Just to really slam it to her, I married an Italian later.

Me – Summer of 67

My first exposure to public protestation occurred when Mario Savio held free speech rallies on the UC Berkeley Campus during my freshman year. Our country was just getting going for real in Vietnam, but I was granted a 3A draft status because I had 2 children at the time, and was unable to participate. A couple of years later, the Chicago riots over the Vietnam war turned our National attention to the voice of the people, while Bobby Kennedy got shot and killed and the Summer of love kicked off the hippie movement in San Francisco. By this time, I had developed a social conscience and participated in all of that, including Woodstock a few years later. Divorced by then, I lived in a communal home in Los Altos Hills. An oxymoron, I know. But, through all of that, I never quit my job in the “establishment”.

Like almost every other Californian my age, I hated Ronald Reagan when he was Governor, but managed to get over it when I was making $250,000 a year in 1972, and voted for his second term. Someone once said that if you weren’t a liberal when you were in college and aren’t a conservative when you were in business, there was something wrong with you. But, that didn’t exactly apply to me.

The view that I have always held was tempered by the question, “What would a reasonable person do or think under these circumstances?” And, I think I owe this to watching and listening to my parents “debate” issues over dinner. Neither one of them was ever reasonable. It was sort of like watching John McCain argue with Nancy Pelosi. Though, my Mom and Dad were more articulate.

Was I a proponent of the power to the people movement in the 1960s and 70s? Sure. I saw then, just as I see now, a disproportionate distribution of attention, power and leverage to a small group of individuals at the expense of an increasingly disenfranchised majority of Americans. Nothing has changed in the way our government manages its business. Make love, not war? Give peace a chance? Of course. Was I a proponent of the hippie movement? Absolutely. Drugs and sexual freedom seemed like a great idea in 1967. Catholic, all male high school boy gets key to the city. Now, not so much.

So, here’s the deal Mr. Winghunter:

First fact, the POTUS has almost no control over the price of gas at the pump. Fact. Mr. Gingrich needs to stop it.

Second, if he agreed to go along with the Keystone pipeline from Canada to Texas, the bulk of that oil ends up being shipped to other places and it would have almost no effect on the price of gas at the pump. It would not create tens of thousands of jobs either (an independent study conducted by the Cornell ILR Global Labor Institute found that the Keystone Pipeline would result in 2,500 to 4,650 temporary construction jobs). It also crosses an active seismic zone and is the dirtiest source of transportation fuel currently available. The proposed route additionally crosses the Sandhills in Nebraska, the large wetland ecosystem, and the Ogallala Aquifer, one of the largest reserves of fresh water in the world. The Ogallala Aquifer spans eight states, provides drinking water for two million people, and supports $20 billion in agriculture. A leak could ruin drinking water and devastate the mid-western U.S. economy.

Third, The price of gas at the pump is affected mainly by commodity futures trading. Yes, the same 27 year-old MBA gamblers in pin-stripes and yellow neckties who took the economy down. Supply and demand, taxes, transportation, cost of crude, refining margins and competition make up the rest of the equation. Are the oil companies making a huge profit. Of course, and why not? As long as we stay stuck on this insane dependency on oil, they will continue to make huge profits.

So, commodity future trading based on the current supply in terms of output, especially the production quota set by OPEC, is the biggest single impact on the price of gas at the pump. If traders believe supply will decline based on say, threats to the straits of Hormuz, or a war with Iran, they bid the price up. If they believe supply will increase, the price falls. Another influence for traders is Oil reserves, including what is available in U.S. refineries and what is stored at the Strategic Petroleum Reserves. These reserves can be accessed very easily, and can add to the oil supply if prices get too high. Saudi Arabia also has a large reserve capacity. If it promises to tap those reserves, traders allow oil prices to fall. The last influence is Oil demand, particularly from the U.S. Demand usually rises during the summer vacation driving season. To predict summer-time demand, forecasts for travel from AAA are used to determine potential gasoline use. During the winter, weather forecasts are used to determine potential home heating oil use.

And, those are the facts, Mr. Winghunter. Facts. Not my opinion.

Mr. Obama is a reasonable man, has a great singing voice, is the ultimate in cool, has done a really good job of trying to lead this dysfunctional country during a time of unprecedented economic disaster, and I intend to vote of him again this November because I know that he will continue to resist terrible ideas like the Keystone Pipeline. As any reasonable man would.

Based on your call sign, Mr. Winghunter, I would guess you are a bird hunter, and like my brother-in-law, a proud owner of a large cache of guns and ammo. I have nothing against that and I applaud your ability to do so, but when the neighbors took me hunting when I was 10 years old, and I had an 8 point buck in my sights at 20 yards, I couldn’t pull the trigger. I personally don’t think it is reasonable for men to kill other living things when it is not necessary for survival. Just my view. Enjoy your day.

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About Steve King

iPeopleFINANCE™ Chief Operating Officer. Former CEO of Endymion Systems, Inc. a $36m Information Systems Services company. Co-founder of the Cambridge Systems Group, the creator of ACF2, the leading IBM Mainframe Data Center Security product; acquired by Computer Associates. IBM, seeCommerce, marchFIRST, Connectandsell alumni. UC Berkeley alumni. View all posts by Steve King

3 responses to “The Price of Gas, and a Reasonable Man.

  • Tim S Handley

    While arguing, if you can call it that, with my Louisianna brother in law who I both love and find myself In diametric opposition to politically, he asked if I would rather get oil form Canada than the middle east, as a prop to support his rage against Obama for killing all those “tens of thousands of” jobs by deferring on the keystone pipeline project.

    As a self described reasonable person, I agreed that I would rather have oil from Canada. I also told him that if I were hooked on cocaine, I would rather my dealer move in next door to save me the trips to the ghetto and the smattering of gunfire that goes along with the trip to get my drugs. But just because I would want to be so enabled doesn’t mean that is what is best for me, … who wants a deviated septum anyway?

    My brother in law thinks I am a commie pinko…

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