Magical Thinking From Tom Friedman

Tom Friedman notes that lower oil prices could hurt Putin (Highly likely!) and ISIS (hmm...). So how do we achieve a lower world oil price? Well, do you believe in magic?

The way you defeat such an enemy is by being “crazy like a fox,” says Andy Karsner, the former assistant energy secretary in the last Bush administration and now the C.E.O. of Manifest Energy. “We have one bullet that hits both of them: bring down the price of oil. It’s not like they can suddenly shift to making iWatches.” We are generating more oil and gas than ever, added Karsner, and it’s a global market. Absurdly, he said, the U.S. government bans the export of our crude oil. “It’s as if we own the world’s biggest bank vault but misplaced the key,” added Karsner. “Let’s lift that export ban and have America shaping the market price in our own interest.”

Selling US oil abroad would surely lower prices abroad, and prop up oil prices in this country. So, for example, the price difference between West Texas Intermediate and Brent crude would narrow. But that spread is in the $4-$6 per barrel range; what price target does Mr. Friedman have in mind?

If the price of oil plummets to just $75 to $85 a barrel from $100 by lifting the ban, and we have implemented tax reform that signals our commitment to clean growth, we inevitably weaken Putin and ISIS, strengthen America and show the world that we deserve to lead because we’re back to doing big, hard things at home that once again differentiate us — not just bombing in distant lands and pretending that’s getting the job done. 

Ahh, tax reform! A key piece of this puzzle is this:

But [allowing the export of US crude] must be accompanied by tax reform that puts a predictable premium on carbon, ensuring that we unite to consistently invest in clean energies that take us beyond fossil fuels, increase efficiency and address climate change. Draining our enemies’ coffers, enhancing security, taxing environmental degradation — what’s not to like? And if we shift tax revenue to money collected from a carbon tax, we can slash income, payroll and corporate taxes, incentivize investment and hiring and unleash our economic competitiveness. That is a strategy hawks and doves, greens and big oil could all support.

So for example, we could tax all oil, domestic or imported, at $50/barrel and try to offset the revenue by cutting other taxes. Already that is problematic for groups such as retirees or the poor, who aren't paying a lot of taxes now.

In any case, the oil/carbon tax should lead to higher energy prices for consumers, reduced demand, and lower pre-tax prices for crude.

Done unilaterally, it will also prompt manufacturers to shift to friendlier venues, like, anywhere. And in contemplating this new reduced international price for oil, will countries like China want to enjoy the free ride or return the gift and impose carbon taxes themselves? 

I can only imagine Tom Friedman's surprise if they don't.

Setting aside the notion of an oil/carbon tax, it might be possible that relaxing the ban on the export of US crude would lead to even more oil production in this country. However since we are still importing roughly one-third of our total oil usage (at global prices) I would infer that a lack of US demand is not holding back production. I also suspect that opening up more federal land to exploration and exploitation would be an easier way to increase US output. More things for Obama to put on his 'not-to-do' list.

Finally, I am trying to picture the impact on the Middle East of $75 oil. However tough that might be on ISIS (I suspect not very) it would be a lot tougher on its nominal adversaries such as Iraq, Iran, and Saudi Arabia. If any or all of those governments were swept away in a tide of public discontent, would that help or hurt ISIS specifically and Middle East stability generally? Take your time, Mr. Friedman, but my guess is that the patient couldn't survive the medicine.

Comments

[daddy]

Magical Thinking From Tom Friedman

Is there any other kind from this fart?

[Captain Hate]

I'm not seeing the word "fracking" in any of this. Of course it would be heresy for Flathead to utter that forbidden word but I didn't think TM was likewise constrained.

[Donald]

He has writers who do this for him right?

It's a comedy styling thing right ?

I like Sarasota, a 54 year old guy with thick curly hair and a few bucks can do alright I think.

The whole Sand Hill crane thing is kinda goofy though.

[daddy]

Off to listen to Kudlow while walking the dogs. Cheers.

[Eric in Boise]

Meh, it seems to me that people want to be left alone to live their own lives, or they don't. If they don't, and they're OK with some people being controlled by others, for some reason they always see themselves as ultimately part of the "controllers" rather than the "controllees", e.g. Friedman, Kruggers, and pretty much every Dem anymore.

What's depressing to me is the fact that many GOPe members are in the second group as well, while insisting in ringing tones that they're in the first.

And don't get me started on the a**holes that insist that because I favor a government that will leave me alone to the greatest extent possible within the bounds of a functioning civil society, I must therefore favor chopping down stop signs and blowing up traffic signals. Our local fish wrap insinuated as much when they commented on the irony of those nasty Tea Partiers walking along government-supplied roads with their protest signs.

Meh.

[narciso]

this is why we can't have a coalition, 'nice things'

http://www.thegatewaypundit.com/2014/09/isis-announcement-weve-intercepted-us-obamas-plan-to-battle-isis/

they leak like a sieve.

[Stephanie accidentally OnT?]

Meant to mention this group for their good works but forgot... they were just spotlighted on GMA or some morning show last week.

http://chicksontheright.com/posts/item/26419-everyone-kneads-to-be-kneaded

[Eric in Boise]

From the comments at narc's Gateway pundit source:

Spot on.

[Ignatz]

--ensuring that we unite to consistently invest in clean energies that take us beyond fossil fuels, increase efficiency and address climate change--

What would be magical would be a little honesty from this shit for brains.
We massively tax fossil fuels so people use less and then massively subsidize unicorn energy so anyone will use it at all and this is going to somehow increase efficiency?

If he keeps it up he's liable to get himself a Nobel Prize for economics too.

[Stephanie accidentally OnT?]

http://weaselzippers.us/198726-liberal-christians-call-on-obama-to-stop-isis-using-community-based-nonviolent-resistance/

I found Harf's interview letter...

[Buford Gooch]

Holy crap, Stephanie. The stupid from that bunch of knot heads at your link is weapon grade. Just getting ISIS to read or listen to that tripe might cause enough of them to bust a gut laughing to stop their advances.

[narciso]

Hold up, ISIS was stealing oil and selling it on the spot market, undercutting the major distributors.

[narciso]

Expecto Petrona,

http://therightscoop.com/obama-actually-tells-chuck-todd-that-his-immigration-delay-wasnt-about-the-midterm-elections/

[MarkO]

In this piece on a failed raid, the NY'er explains little Mr. Obama was kept in the dark about the plans.

To which I say, horseshit.

http://www.newyorker.com/news/news-desk/inside-failed-raid-free-foley-sotloff

[Stephanie accidentally OnT?]

I'd rather have the green flash of light aimed at Obama, narc. IYKWIM.

[Stephanie accidentally OnT?]

Could the Buckeyes look any more rancid?

[Stephanie accidentally OnT?]

This is cool:

http://buzzpo.com/awesome-dallas-stars-goalies-new-mask-honors-lone-survivor/

[narciso]

their muffins are very dangerous:

http://weaselzippers.us/198884-us-and-syrian-hit-islamic-state-targets-in-iraq-and-syria/

[Comanche Voter]

Keep eating those magic beans Friedman.

He's an interesting fellow in a way. I once had a year where things were pretty slow, so I read the New York Times at lunch every day--including the op ed pages. Even in those days I was smart enough to avoid reading Krugman. Every sentence you read of Krugman kills 100 brain cells.

But Friedman appeared on the surface to be reasonable. But I discovered--over the course of the year, that sooner or later old Tom would come around and contradict himself. In May he'd say object A is a very good thing. Then in December he'd say object A is a very bad thing. Name the subject of one of his op ed pieces--and invariably you'd see him take diametrically opposed opposition--sometimes sooner, sometimes later--but inevitably so.

[narciso]

Schmidle peddled a similar narrative, with the Bin Laden raid,

[Brainster]

To consistently split infinitives...

[jimmyk on iPad]

"and we have implemented tax reform that signals our commitment to clean growth, "

I don't suppose Manifest Energy, Inc. has any stake in "clean energy." Nah, that would be too cynical on my part.