What Price the Endangered Species Act?

In 1973 when President Nixon signed into law the Endangered Species Act, which had been passed by a bipartisan vote in Congress, everyone doubtlessly conceived it would protect valued species like the bald eagle, the California condor, the grizzly bear, humpback whale, and the peregrine falcon. I doubt that anyone imagined it would destroy so much of the West’s economy; allow opportunistic groups to kill or substantially delay and raise the cost of needed water and energy projects to save insignificant creatures which in the end thrived after transplanting them; contribute to massive forest fires; and end up killing off one species to save another.

That, however, is just what has happened. The Trump administration tried to rectify the worst features of the regulations under the act and the present administration has rescinded them. Three examples show the operation of the act and its need for reformation.

The Snail Darter

The first use of the act to kill or delay a major project was the Tellico Dam/snail darter case. It became a template for every green group trying to prevent major construction projects. In 1967 efforts to create the TVA’s Tellico Dam for water storage in Tennessee began. A group led by a professor at the University of Tennessee tried to halt the project when it was 90 percent completed because it claimed the project endangered the snail darter population. This is a small fish (about 2 to 3 inches) and it was claimed that the dam blocked its migratory route. The litigation went to the Supreme Court which held the act applied. Various legislative remedies were attempted until finally a public works appropriation exempted Tellico from the act . President Carter signed that law in 1980 and the project, long delayed at considerable cost went into effect. As for the snail darter, this year it has been taken off the list of endangered species, transplant efforts having succeeded.

 TVA’s contribution to the reservoir and peninsula supports about 1,800 jobs and $137 million in capital investment annually as a result of economic development efforts led by the Tellico Reservoir Development Agency. As for the snail darter, the fish was reclassified from endangered to threatened in 1984 and now thrives throughout the Tennessee River system.

But the case law proved useful for any group desiring to block contemplated projects.

The Meadow Jumping Mouse

This is a tiny long-tailed mouse able jump as much as three feet. It is found in New Mexico, Arizona and Colorado. In 2014 it was listed as endangered and the United States Fish and Wildlife Service designated 14,000 acres in these three states as “critical habitat” for the mouse, substantially reducing livestock grazing on this land. Understandably the ranchers sought injunctive relief, contending this designation would contribute to their costs, endanger the cattles’ health and lower property values. The federal courts rejected their claims.

The Spotted Owl

To save the spotted owl, a medium-sized brown bird, the act was employed to destroy California’s timber industry by preventing logging on millions of acres of forest, and in the process led to the state’s massive wildfires because the demand that the trees remain untouched created substantial tinder for such fires.

From 1988 to 2011... the number of wildfires in California “increased by seven large fires annually.” It is no coincidence that 1988 was the year the spotted owl received protection. Over the past five years the wildfire situation has grown even worse. Seven of the deadliest fires in state history have occurred in that period. The state’s annual fire season now extends from June or July into late fall.

The wildfires have gotten wilder too—bigger, deadlier, harder to contain and put out. Last year’s Dixie Fire laid waste to a million acres of land, earning the unhappy title of California’s biggest fire. And, as with all these major conflagrations, it spread smoke up and down the state, darkening skies and poisoning the air.

Now some of the environmentalists have switched gears, and want “controlled burns, selective thinning of drought-ridden trees and underbrush”—i.e, competent forest management. Unfortunately, in killing the lumber industry there are now fewer loggers and sawmills to handle the job. as for the spotted owl, it has a new threat: barred owls have invaded their territory and are being culled to save the spotted owls. If we cull too many of them, will they, too, go on the endangered list ?

The destruction of so many lives and livelihoods in an effort to reach environmental stasis—an impossibility—is ridiculous. We need a stronger application of cost-benefit analysis; the Trump administration made that effort in 2019, revising the rules to place greater weight on the act’s economic consequences. It raised the standard for designating areas as “critical habitats” that are not currently inhabited by protected species . It set stricter standards on adding species from the legislation's protections and made it easier to remove them from it. It permitted agencies to make economic assessments when deciding which species to protect regarding construction projects in critical habitats, and it limited the unmanageable and costly delays a cumbersome consultation process had set in place.

Very quickly the new administration set about removing these revised regulations. On July 5th of this year a federal district court restored three of the pre-Trump regulations. On July 22 the administration removed the last of the Trump revisions.

Maybe it we can find something like rare pink spotted cockroaches in the critical habitats of San Francisco, New York City and Washington, D.C., businesses and offices we can make Democrats cognizant of the need to restore the prior administration’s regulatory revisions.

OPEC Slashes Production: Dems, Your Wallet Hardest Hit

The Organization of Petroleum Exporting Countries, OPEC+, has agreed to a major cut in oil production. According to CNN, the supercartel -- which includes the 13 member nations of OPEC as well as a loose grouping of ten or eleven other oil producing states like Russia, Mexico, and Kazakhstan -- will slash production by "2 million barrels per day, the biggest cut since the start of the pandemic," a reduction "equivalent to about 2 percent of global oil demand."

Always concerned about the fate of their beloved Democrats, the CNN report makes it a point to mention that this "threatens to push gasoline prices higher just weeks before U.S. midterm elections." No kidding. Of course, for our captured commentariat, the disruption this might cause to their political narrative is a bigger deal than the disruption to people's lives. Gas prices have come down since their summer peak, but they are still outrageously high compared to just a couple of years ago. Americans are already struggling to fuel their cars and handle the soaring price of groceries and other necessities that have been inflated by soaring gas prices.

Still, they're not wrong. Despite some frankly terrible candidate selections on the GOP side, widespread dissatisfaction with Democratic policies have made several midterm races closer than they have any right to be. Oil and gasoline prices trending upwards again, especially just as heating season is getting underway, is likely to tip the balance further to the right.

No wonder Politico reports that Democrats are "seething" at the vote, and are frustrated that the Biden administration's attempts to influence OPEC decision making -- including a presidential visit to Saudi Arabia in July -- were all for naught. While visiting Riyadh, Biden's charm-offensive infamously included a fist-bump for the cameras with Crown Prince Mohammed bin Salman to kick-off their meeting. Maybe he would have gotten better results if Biden hadn't pledged during his presidential campaign to make the Kingdom a "pariah" state. Wanna bet the Crown Prince took exception to those remarks?

Hoping to get out ahead of GOP point-scoring, Rep. Tom Malinowski (D-N.J.), put out a statement saying, “I hope that Republicans will join me in supporting [economic retaliation] rather than wishing high gas prices on the American people so they win an election."

Nice try, but the Democrats are responsible for this mess, and they're going to have to live with the consequences. If they weren't so focused on killing Keystone XL (the original sin of this administration's energy and economic policies); on banning oil and gas leases (and then half-heartedly reintroducing them); on pushing ESG on their big bank cronies at every turn; on backing the closure of U.S. oil refineries, or their conversion into BioFuel processing plants; all while appointing devout Green New Dealers to the cabinet; and generally waging war on the resource sector, we wouldn't be in anything like the mess we're in.

Not to worry though -- the White House is looking to make it all better by releasing 10 million more barrels of oil from the Strategic Petroleum Reserve (because that worked so well the last time) while easing sanctions on Venezuelan president Nicolás Maduro's oil-rich authoritarian regime. Maybe Glenn Reynolds was right when he said the real issue here is

[Our] domestic oil industry enriches people — and states — Democrats don’t like." Money going to Saudis, Russians or Venezuelans is one thing, but money going to Texans, Oklahomans or South Dakotans is another. Truth is, red states and their inhabitants rank higher on the administration’s enemies list than do shady foreign nations.

One year ago, right here at The Pipeline, this author wrote that, under this administration, "OPEC is back in the driver's seat." Sometimes, you hate to be right.

Who Blew Up the Nord Stream Pipelines?

The Nord Stream pipelines, which run under the Baltic Sea, have been severed by an explosion, causing huge amounts of natural gas to spill out into the ocean. That much is certain. Moreover, sabotage was the most likely cause. After all, one pipeline being breached by an explosion would be suspicious. But two? In three separate places? Especially with those pipelines being a bone of contention between major powers in the midst of a war? High unlikely.

And it isn't just the multiplying of coincidences -- according to Bloomberg, there is hard evidence that it was not an accident:

Germany suspects the damage to the Nord Stream pipeline system used to transport Russian gas to Europe was the result of sabotage. The evidence points to a violent act, rather than a technical issue, according to a German security official, who asked not to be identified because the matter is being probed. In response to the pipeline leaks in the Baltic Sea, Denmark is tightening security around energy assets.

So who is responsible? Early statements from Western leaders have pointed the finger at Russia, but it seems extremely unlikely that Vladimir Putin would order the destruction of his own pipeline. Especially since he has been using Nord Stream to remind German Chancellor Olaf Scholz of the cost to his country for the continuation of the war in Ukraine into the winter months. As this author wrote recently, the Russians have "cut down natural gas flows to Germany by 60 percent, blaming mechanical problems while ostentatiously burning $10 million worth of natural gas per day at the mouth of the Nord Stream pipeline rather than sending it to Germany."

Why would Putin cut off his own pressure point? And if not him, who? Tucker Carlson has a theory. Perhaps it was the Biden White House. It sounds crazy: could Biden, Carlson asks, and his merry band of environmentalists intentionally leak millions of gallons of liquid natural gas into the ocean, and from there into the atmosphere, when they are always going on about the horrible effects of gas on the environment?

At the same time, Carlson and his team have unearthed footage of President Biden and the State Department's Victoria Nuland (who always seems to be caught up in the affairs of Ukraine) assuring the American people that if Putin invades, than (in Biden's words) "there will be no longer a Nord Stream... We will bring an end to it."

Moreover, Carlson points to a tweet from Polish politician Radek Sikorski, who is overjoyed by this development and clearly thinks it has Biden's fingerprints on it.

Sikorski is a member of the neo-liberal Civic Platform party (which the Biden administration would love to see come back into power in Poland) and previously served as Minister of Foreign Affairs under Donald Tusk, who went onto become president of the European Union. He's also married to The Atlantic's Anne Applebaum, who Carlson rightly refers to as the liberal world order's "regime stenographer." All of which is to say, he's very well connected and this is more than conjecture on his part.

What would be the consequences if it does turn out that the America is responsible? Mark Antonio Wright thinks it would mean a serious breach between Germany and the United States:

It shouldn’t need to be said, however, that the fingerprints of the United States on this incident would break the Western alliance. Whether or not it was bad economic and geopolitical policy on the part of the Germans to build this pipeline (and it surely was), the Germans would never forgive America for such an action. Do you think that German politicians would be able to withstand the political pressure from a very cold German public during a very cold German winter if America could be shown to be responsible for some of that trouble? I don’t. The Germans would throw the Ukrainians overboard, and the United States would have surrendered the moral high ground and probably lost this war in a single stroke.

Tucker Carlson's take is even darker. He argues that this would be a direct provocation of "the largest nuclear power in the world." Not, he says, that we should expect it to go nuclear immediately. But it would give Russia a real excuse to engage in some industrial sabotage of its own. Which could, very quickly, "cascade downward" into the homes of average Americans.

Watch his report and make your own decision.

From Hearings to Hogwash

With gas prices now broadly lower than a few months ago, and believing it is tactically valuable with mid-terms just over fifty days out, Democrats have resumed their attacks against the oil and gas industry. Apparently believing that Americans are thirsting for the unimaginative narrative that oil and gas industry greed is responsible for creating higher gas prices and concomitant economic malaise, they are heading for a mighty miscalculation. They prefer to ignore the plainly failed Biden policies that are creating the current market conditions responsible for record inflation and higher prices for everything from gasoline to Gatorade, and instead toreturn to tactics that offer symbolism over substance.

We've just witnessed two days of hearings by two separate committees eager to get back to the boring bloviations by politicians and academics. Together, the Committee on Oversight and Reform and the House Natural Resources Subcommittee on Oversight and Investigations offered feigned outrage about oil and gas producers, and misstated facts and re-framed realities. The strategy of each committee was slightly different, but the tactics and overarching objective remained the same. Use whatever means necessary to hamper, intimidate, denigrate, and dismantle the most important sector of the U.S. economy—energy—to destroy the economy and force a change of behavior by the American people that would never be possible if the Democrats' political ideas were taking the country in a positive direction.

Acknowledged by leaders of both parties prior to January 2020 as the most important driver of economic vitality, inexpensive and abundant energy has now become a whipping boy for Leftists. Extracted using low-impact techniques, innovative processes, advanced technological engineering and a well-paid workforce, the American oil and gas industry delivers the safest and most cleanly produced oil and gas in the history of the world. But from the start, Biden has issued a steady stream of executive orders intended to hamstring the industry, limit supply so as to drive prices up, and give broad regulatory authority to agencies to investigate and in some cases arbitrarily punish those who ignore his demands to produce energy from "renewable" energy sources. All in complete denial of reality: that alternative energy sources such as  wind and solar are neither reliable, nor capable of meeting the energy needs of this country. 

America held hostage: Congress suspected.

Since Biden entered office, there has been an orchestrated effort by the president’s advocates, agency leadership, and committees on the Hill to denigrate, and if necessary, delegitimize opposing political views, industries, and economic activity. Agencies have been granted unprecedented investigatory powers through executive orders at the Security and Exchange Commission, the Energy Department, and Department of Justice through their "environmental justice"  initiatives, while congressional committees issue a blizzard of subpoenas. Legal energy-related businesses and even truth itself have come under the scrutiny of hostile officials who forget they work for American taxpayers.

During this week’s hearings by the Committee on Oversight and Reform, chairwoman Carolyn Maloney (D-NY) asserted that oil companies should somehow not be in the business of oil and gas production. Instead, they should direct their oil and gas revenue toward alternative power generation activities… which do not create sufficient revenue to keep the companies viable. By her lights, Exxon should be using investor capital to not maximize revenue from its core business activity. All while ignoring legal obligations Exxon has to investors and while ignoring the role the administration has had in obliterating America’s energy production capabilities through deliberately destructive policy prescriptions. 

Meanwhile, the House Natural Resources Subcommittee on Oversight and Investigations was continuing with its ongoing investigation of public relations firms’ role in "spreading climate change denial.” According to reports, chairman Raúl Grijalva (D-AZ) and subcommittee chair Katie Porter (D-CA) have been seeking documents from several private companies detailing their work for oil and gas producers and industry trade associations. These are legal companies being told they need to turn over their client documents to the government for partisan political reasons. This is intended to have a chilling effect on professional-services providers who work in the oil and gas industry, and is a tactic intended to promote fear and to coerce participation in inane hearings like these. To their credit, the companies declined the request to participate in the charade.

Don't forget unicorn farts.

While the committees are using their tactics of coercion, so too is the administration. The director of the National Economic Council, Brian Deese, is a former BlackRock executive who enthusiastically embraces the dubious environmental, social and governance (ESG) construct which intendeds to re-orient investor capital toward what are described as “global goals” that include the funding of businesses and industries that align with BlackRock’s economic interest and political worldview, even if in defiance of the best interest of their clients. Like committees’ subpoena threats against private citizens running their private companies, the ESG concept is similarly intended to change corporate behavior. If the corporations have the acceptable ESG score, determined by their political adversaries, they get the capital they need to run their companies, If not, as is happening with the oil and gas industry, the companies have difficulty accessing the capital these ESG advocates control.

As the energy industry goes, so goes American capitalism. You've been warned.

Post-Boris, a Battle with Biden and the Blob

In the end, after a good night’s sleep and some reflection, Boris Johnson did not cling raging onto power like Donald Trump, as his critics in Parliament and the media had predicted. Instead he resigned his leadership of the Tory party, made a wry and thoughtful speech (“them’s the breaks” gave translators a hard time), appointed some ministers to fill the jobs in his caretaker government made vacant by earlier resignations, and waited for the Tory Party to elect a new leader so that he could resign as Prime Minister too.

His exit was far more dignified than were the embittered demands of his parliamentary enemies (on both sides of the House of Commons) that he be driven into the streets, made to apologize for his sins, and in general treated as a criminal released on bail but bound to end up inside before too long.

Make no mistake about what’s going on. This is scapegoat politics.

BoJo: no longer PM, but still an honorary Cossack.

Boris is having to shoulder the blame for the pandemic, the lockdown, the cancelation of most other medical treatments in order to treat Covid patients promptly, the closing of schools and universities, and the accumulating costs in billions of the shutdown of the economy to save lives. All of these now look like serious errors since the Swedish “experiment” of protecting the elderly from Covid rather than maintaining everyone at home at the taxpayers’ expense saved billions of public money and kept the Swedish economy humming along. Was Britain's lockdown—and all its attendant costs—really necessary? That looks increasingly unlikely.

And if not, was Boris responsible for these disastrous decisions? Well, he was prime minister and therefore in principle responsible for all the decisions of his government. But the political reality is that in the early stages of the pandemic, the politicians had no realistic alternative to adopting the remedies prescribed by the scientists in Whitehall and Imperial College and by the U.K. medical officers of health.

If they had rejected their advice and instead followed the Swedish example, the opposition parties, a hostile media, and influential tabloid personalities would have accused them of risking wholesale slaughter—and a frightened risk-averse public opinion would have believed them.

As it was, all these forces wanted the pandemic restrictions to be tougher and longer. For a long time Boris and his ministers were more or less ventriloquist’s dummies speaking lines written by scientific and medical officialdom in London. Boris struggled to break free and eventually ended the lockdown. But he took a lot of heat for doing so sooner than the Whitehall committee of SAGE, plus “Independent Sage,” the media, Labour, and Uncle Tom Cobley and all wanted.

Did Covid help do him in?

Britain today and tomorrow will be paying a heavy price for their miscalculations, risk-averse science, and economic ignorance. Boris is paying it today.

In other respects he had real achievements to his credit. He got Brexit done. He sent the extreme left Labour leader, Jeremy Corbyn, packing in the 2019 election. He put together a broad-based national coalition of all social classes to win his 2019 landslide victory. He was personally popular--a well-known public figure who had edited the Spectator magazine, written a column in the Daily Telegraph, and appeared for years on a popular radio comedy program about current affairs: "Have I Got News for You." And he still has lots of supporters throughout the country who are indignant at his defenestration.

Why then is he Out with a capital O? The answer is his policies. More and more voters, especially those who voted Tory in 2019 for the first time ever, thought he had let them down over policy. And, sadly, they're correct. His policies were almost more socialist than Labour, hiking spending and raising taxes. He was a passionate advocate of a “Net-Zero” carbon emissions that threatened to reduce living standards, increase taxes and electricity prices, and make the energy crisis a permanent one.

Why did he embrace these policies? I believe it was for the same reason that he initially bowed down to the consensus of doctors and scientists: he believed he had no alternative. It’s vital to say that clearly now because almost exactly the same thing is likely to happen on a very different playing field, the Tory leadership election, unless we wake up.

The candidates seeking to succeed Boris—and there are now about twelve of them—almost certainly believe that Net-Zero and other Green policies governments are pursuing throughout the West are set in stone because the Blob of international bureaucrats are telling them so. They have signed treaties saying so that they must enforce--the Paris accords in the case of Net-Zero. There's no alternative.

Going "Green" kills.

But the practical results of these policies are becoming clear and disturbing: their costs are rising; governments are forced into more and more absurd postures to meet their obligations—e.g., Germany is now reliant on "dirty" coal because it's closing down its remaining nuclear power stations; and the threats of energy blackouts and forced lifestyle changes are becoming more real to the voters. Net-Zero is a particularly visible and painful case of this government spending by international treaty obligation--but not the only one.

The same is true of many other policies that the bureaucratic groupthink of international bodies sanctifies as politically essential or a done deal—for instance, the Biden administration's push for all countries to agree on a high (15 percent) uniform rate of business tax that benefits high-spending governments such as France and Germany and disadvantages smaller economies like those of Ireland and Hungary. Britain's chancellor under Boris, Rishi Sunak, didn't like this tax which is higher than the Brits want, but he went along with Biden for the sake of a quiet life and agreed the Brits would raise it too.

Well, in the race to succeed Boris, all these issues are up for grabs. Democracy is no respecter of international bureaucratic stare decisis. Rishi Sunak may be stuck with his 15 percent business tax that disadvantages U.K. companies, but none of the other candidates are. Ditto Net-Zero. And if one candidate comes out against these policies and the higher taxes they require, he creates an incentive for all the others to do so—and with luck starts a policy auction.

Indeed, if one candidate were to put together a policy package that included Thatcherite cuts in both taxes and public spending, a shift of resources into defense, a more rational energy policy that stressed security, reliability, and price rather than “renewables,” a post-Brexit policy that makes Britain more competitive by diverging away from the E.U.’s burdensome regulations, and a defense of Britain’s traditions and achievements against the Wokerati in the establishment and civil service, he might break through the log jam of progressive policy-making by international bureaucracies and restore democratic control of taxation and public spending.

Blown away, but the fight goes on.

As it happens, Lord David Frost, who resigned from Boris's government at the end of 2021 because he objected to its “direction of travel,” made the case for just such a policy package in last Wednesday’s Daily Telegraph. He’s not in the Commons, but he's prominent in Tory debates, and he might well return to the Cabinet under a new leader. He's already leading the way in policy formulation and he won't object to candidates in the race accepting that baton from him.

Already, one of the candidates, former Attorney General Suella Braverman, has done so. Others are likely to follow:

In order to deal with the energy crisis we need to suspend the all-consuming desire to achieve net-zero by 2050. If we keep it up, especially before businesses and families can adjust, our economy will end up with net-zero growth.

It won’t happen overnight. It took Margaret Thatcher seven years from her election as Tory leader to get the kind of leadership colleagues who supported her radical and highly successful reforms—and she was building on thirty years of intellectual hard work by the Institute of Economic Affairs. But the log jam is finally breaking.

Biden Mistakes Demand For Supply

Gas prices continue to average around $5.00 per gallon nationally, which is a major factor in our ongoing issues with inflation. Democrats, with the upcoming midterm elections in mind, are freaked out. And all the more because President Biden's approval rating, according to two new polls, is down to 32 percent. Glenn "Instapundit" Reynolds predicts that that number will continue to drop, commenting "He has only begun to fail."

How, you ask, could a Democratic president, in our hyper partisan age, with the media always in his corner, fall much further than 32 percent? By refusing to address this problem in any meaningful sense. That's exactly what we're seeing -- the president's response to rising oil prices thus far has been to blame "greedy" oil executives (we're meant to believe that they were overwhelmed by greed only after Biden took office, and not during the plutocratic Trump administration) and Vladimir Putin's aggression in Ukraine (never mind that prices had been rising steadily for months before Russian hostilities began), while maintaining the same anti-oil and gas policies he's held to since the day he entered the White House.

No one is buying it, of course, so Team Biden has moved onto gimmicks which they hope will distract the voters. Earlier this week, the president called for a temporary suspension of federal gasoline and diesel taxes. Such a move would shave somewhere in the neighborhood of 15 or 20 cents per gallon off of your local fill-up price.

Now, we'd all like to pay less for gas, but this isn't going to work. We've even seen the same play fail not long ago. As Saagar Enjeti recently explained,

On June 1st, New York suspended its motor fuel tax of eight cents a gallon, as well as its four cent sales tax on up to two dollars a gallon. The average price of gas that day was $4.93 cents. Two weeks after what is, in effect, a .16 cents per gallon tax holiday went into effect in the State of New York, the price of gas was $5.04 per gallon!

Fundamentally, the problem we're facing now is one of supply, and that is being choked off both by our limited refinery capacity (which is itself a product of environmentalist policies that make it nearly impossible to build new refineries) and Biden's anti-resource-sector positioning. By goosing demand -- people will drive somewhat more if gas prices are somewhat lower -- Biden's proposal arguably exacerbates the problem.

And no federal taxes!

As things stand, the opposite is happening. The Wall Street Journal reports that the demand for gas this spring and summer is down between 5 and 8 percent from the pre-pandemic average, a significant drop. "Drivers have begun consolidating trips or filling up their tanks with only as much fuel as they need to get by for a few days. Some are carpooling or taking mass transit, while others are working from the office for fewer days each week, analysts said."

This might not be such a bad thing -- the WSJ quotes OPIS head Tom Kloza as saying, “You have to have some demand destruction to give supply a chance to catch up.” It is, essentially, a case of the market adjusting to demand outstripping supply. But the less driving there is, the fewer goods and, especially, services are consumed. An economic slow-down will be the consequence of this, and very likely, a recession.

Pray that our house of cards doesn't tumble from the shock, and that our leaders -- Biden included -- correct course before things go too far. But don't count on it.

Success: Biden Gets the High Gas Prices He Promised

For decades now, the Democrats have painted gas and oil producers as whipping boys for the failure of their own party’s policies. This year as pump prices have skyrocketed and every single facet of our economy is suffering from the shortfalls in production, they once again seek others to blame. Sticking with their playbook that nothing is ever their fault, despite the fact that the record is clear that it is, President Biden casts the blame on Putin and the producers.

The record is clear, however, that the shortfalls are the direct result of the administration’s policies. And Exxon’s response to Biden’s blame shifting is telling but incomplete. Noting that the company has been in “regular contact with the administration” it describes the steps it has taken to increase production and expand refinery capacity, something the administration has obviously ignored:

We increased production in the Permian Basin by 70 percent, or 190,000 barrels per day, between 2019 and 2021. We expect to increase production from the Permian by another 25 percent this year. We’re spending 50 percent more in capital expenditures in the Permian in 2022 vs 2021 and are increasing refining capacity to process U.S. light crude by about 250,000 barrels per day – which is the equivalent of adding a new medium sized refinery.

We reported losses of more than $20 billion in 2020, and we borrowed more than $30 billion in 2019 and 2020 to support our investments in production around the world. In 2021, total taxes on the company’s income statement were $40.6 billion, an increase of $17.8 billion from 2020.

The Forbes writer, David Blackmon, goes on to note:

The president of the United States is simply lying to us. The reality is that Exxon and other oil companies are drilling and investing, on a massive scale, both in the United States and worldwide. They pay many billions in local, state and federal taxes. And if the government doesn’t think it’s enough, then Congress can change those laws.

Penury by design.

Here are some significant specific actions the administration has taken to reduce gasoline supply, something they expressed pride about as it in their words, will speed the transition to “renewables.” And this cockamamie plan certain to raise gas prices was cheered on by the major media 

  1. Cancelled the Keystone pipeline  bringing crude oil from Canada to U.S. refineries
  2. Pulled three offshore oil lease sales and curbed new drilling this year
  3. Failed to appeal a judicial ruling revoking drilling leases in the Gulf of Mexico
  4. Limited fracking
  5. Issued regulations that strained our already too-limited refinery resources
  6. Promoted new taxes on oil and gas production

Last month, before the consequences of this lunacy became fully apparent to voters, Biden bragged about these deliberately destabilizing policies. Try diagramming this jumbled thinking:

Out of touch as ever, President Biden celebrated record-high gas prices Monday, gushing that the pump pain was part of “an incredible transition” of the US economy away from fossil fuels. “[When] it comes to the gas prices, we’re going through an incredible transition that is taking place that, God willing, when it’s over, we’ll be stronger and the world will be stronger and less reliant on fossil fuels when this is over,” Biden said during a press conference in Japan following his meeting with Prime Minister Fumio Kishida.

The president then insisted that his administration’s actions, rather than increasing the price of gas, had actually been able to “keep it from getting worse — and it’s bad.” Only then did Biden pay lip service to millions of Americans who have found themselves spending thousands of extra dollars to fuel up their vehicles.

The oil industry is fighting back. On Wednesday, the American Petroleum Institute sent the letter below directly to the White House, rebuffing Biden's disgraceful demagogic attacks with facts. Have a look:

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Oklahoma senator James Lankford is one who does understand what the major media do not, and smashes the ball right back into Biden’s court:

Twenty-four percent of the oil that we get in the United States comes from those federal leases. So when he has now, still, not re-opened the short-term moratorium on federal leasing, he’s cutting off the future of oil into our country. And it continues to accelerate prices….. And literally, this week, the Biden Administration announces that they want more American companies to do more production, but then this week they release they’re budget after saying to American companies, ‘Why aren’t you producing more oil,’ the Biden Budget has 15 brand-new tax proposals that they’ve got on the production of oil and gas.

And the production is just part of the picture. The petroleum has to be refined. Forty-two years ago I co-authored a book, noting the refinery shortfalls and the need to upgrade and build more refinery capacity. Spoiler alert: we didn’t.

No worries, I'm off to Delaware for the weekend.

As the editors of the Wall Street Journal report, the president has finally noticed we are short of refinery capacity to process crude, and “a major culprit is U.S. government policy.” When the government insists on an abrupt shift from fossil fuels to tackle a largely imaginary problem of "climate change," it’s hard to justify spending more to upgrade refineries to process crude oil. And then there’s the EPA, which has tightened permitting requirements and demanded steeper mandates for biofuels. But there’s more: having to blend more ethanol requires that refiners must purchase regulatory credits to comply and those credits have increased in price driving some refineries out of business.

If the President wants “concrete ideas” to immediately increase capacity and production, maybe he should reverse policies that are designed by his administration to put producers and refiners out of business? Well, that’s just a thought. The people in this crowd who can’t master the simple math of supply and demand are unlikely to be able to follow this line of reasoning.

Weaponizing the Government Against the People

To assert that Washington D.C. is a political place is as obvious as asserting Twitter opposes free speech. It’s empirical. However, in the case of a bill the House recently passed, there is no doubt that legislators have reached a desperately new level of political gamesmanship. Whether rooted in blind ignorance, willful oblivion, or good old fashion partisan jackassery is not entirely clear. What is clear, however, is that there are specific tactics being integrated into many pieces of legislation introduced by House Democrats. Since taking office the Biden administration is keen to stitch investigatory powers into the authority of many agencies, even in defiance of political or constitutional reality.

Known as The Consumer Price Gouging Prevention Act of 2022,this bill passed largely and unsurprisingly along party lines, with the exception of four Democrats who joined their Republican colleagues and voted against it. The bill gives the president the power to issue an emergency declaration that would make it unlawful to hike gasoline and home energy prices, “...in an excessive or exploitative manner." It would also give the Federal Trade Commission (FTC) more tools to crack down on (punish) alleged price gouging, allowing the FTC to prioritize enforcement action on big oil and gas companies.

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There are, however, a couple notable problems with this legislation and the corresponding vote on the House floor. Responding to price gouging doesn’t work if the people allegedly gouging don’t actually control the price of the products for which gouging is being alleged.

The oil and gas industry is divided into well-delineated sub-sectors. They include "upstream," focused on drilling and extracting oil and gas from out of the ground; "midstream," which broadly constitutes processing, storing, transporting and marketing the oil and gas extracted by the upstream companies; and "downstream," which represents the refining, distribution and retail sale of petroleum products.

Setting aside the lack of a definition in the bill of what  "excessive or exploitative” might mean in the context of free markets, the more disconcerting element is that the legislation was specifically written to impugn the upstream oil and gas sector instead of to actually bring relief to consumers. These legislators know the upstream sector doesn’t control the prices consumers pay at the pump or for home heating oil. That wasn’t the point of introducing the legislation. Intentionally misleading their constituents while doing nothing to mitigate the market conditions was the point.

Beware of the regulatory monkey.

After having called for hearings last month about the causes of increasing fuel prices, the Democrat sponsors of the bill and those who voted for it, desire to conflate the activities of the oil and gas industry with the Biden administration’s failed energy policies and objectives, which these legislators support. It is a feckless effort that wastes time and resources, and diminishes the confidence of the electorate in their elected representatives. Their constituents, after all, are experiencing real economic hardship because of high consumer prices for fuel. Engaging in political stunts that achieve no tangible end is disrespectful and lazy.

Rep. Lizzie Fletcher, (D-TX) is one of the four Democrats who voted against the bill. "The Consumer Fuel Price Gouging Prevention Act would not fix high gasoline prices at the pump, and has the potential to exacerbate the supply shortage our country is facing, leading to even worse outcomes," Fletcher said in a statement. "For these reasons, I voted no on this legislation today."

While the legislation passed 217-207 in the House, it is ultimately expected to fail in the Senate where it would need 60 votes to overcome a filibuster the Republicans and Senator Joe Manchin (D-WV) will undoubtedly use to defeat it. More insidious than eye-rolling, however, is not the outcome of this round of legislation but rather, the integration of a tactic that has become increasingly common under the Biden administration and should be concerning to voters of both parties.

Whether dealing with gasoline and home heating prices, the integration of the environmental, social, governance (ESG) construct into the Security and Exchange Commission (SEC), or the formation of a new division for ‘environmental and social justice’ at the Department of Justice (DOJ), this administration unceasingly tries to codify investigative authority by various agencies into their legislation. They seek this power so they can punish political adversaries whom this administration views as enemies. When the idea fails to persuade, the administration immediately turns to heavy-handed investigatory overreach.

Big Congress is watching you.

Perhaps its historically abysmal approval ratings are an indication of how few people agree with the Biden administration’s approach. Regardless, the willful misrepresentation of issues, followed by a barrage of administratively created investigatory powers feels more "Stasi-esque'" than demonstrative of serious political acumen. The ultimate objective of the administration, it seems, is to politicize every challenge and use it to take greater control of every aspect of American life. This "gouging" bill is merely another example. The relief that a genuine policy change would bring is ignored and in its place are disingenuous attempts to gain control of the direction of the country through intimidation.

With the mid-term cycle now under way, the miscalculation this cynical tactic represents could prove more damaging to the extreme progressive wing of the Democrat party than even Republicans anticipate. Independents and even moderate Democrats are realizing that they are being treated like Monopoly pieces on the playing board of politicians committed to the entrenchment of their own power. Where post mid-term legislation can’t role back the investigatory tactic, judicial challenges will assuredly be employed. The American people, of broad political underpinning, are growing weary of the disrespect of the disingenuous in D.C.  

Banks Line Up to Join ‘ESG’ Mob

In the last year, the cost of energy has increased significantly. Gasoline, diesel, and domestic electricity and natural gas prices are now past the point that many people can bear. The problem affects businesses too, including manufacturing and agriculture, with consequences for the wider economy, jobs and the cost of living. It has led to a new word, “greenflation.” Greenflation is harming those who, literally, can least afford it.

However, instead of discerning what is behind these problems, what caused them, what role the federal government had and what it can do to ease the problem, the government is simply blaming others and pressing on. Treasury Secretary Janet Yellen is not only in denial but serially insists that the problem is that the administration just hasn’t proceeded on the “climate” front fast enough.

This is governmental malpractice. But the perpetrators are not without accomplices. The investor class, and big banks foremost among them, share equal responsibility. One of the chief culprits is a pernicious and destructive concept called Environmental, Social, and Governance investing.

Yellen: in "climate" denial.

A 2016 email suggests that modern “ESG” began as anti-energy campaigning against financial institutions in 1999 focusing on hydropower, then morphed into anti-coal advocacy then soon expanded to opposing all abundant energy sources.

Bank of America seems to have been captured first, vowing to not finance hydrocarbon energy (beginning with coal). Freedom of Information Act litigation showed the bank's enthusiasm for the "climate" agenda. A senior bank official, Jim Mahoney, hired former Clinton hands as consultants to get the bank close to then-Secretary of State John Kerry with offers to sponsor as much of the 2015 Paris climate talks as it could.

Yes, financial institutions sponsoring treaty negotiations. More recently, FOIA litigation produced still more craven correspondence, this time to Yellen from, among others, Wells Fargo. In a March 2021 email to a senior Treasury official, former Clinton Treasury official turned Wells lobbyist Elisabeth A. Bresee laid out the bank’s “climate” plan:

I'm reaching out to share an exciting climate change announcement. Wells Fargo just announced that we're setting a goal of net-zero greenhouse gas emissions, including in its financed emissions, by 2050. Wells Fargo believes that climate change is one of the most urgent environmental and social issues of our time and, as one of the largest financial institutions, we are committed to taking action, including aligning our activities to support the goals of the Paris Agreement.

In recent years, we've made tremendous progress in meeting and exceeding sustainability goals in our operations, working with NGOs and other stakeholders on climate-finance strategies, enhancing our transparency and disclosure, and partnering to advance clean technology innovation, community resiliency, and green jobs. We've also put in place a strong foundation and processes for managing climate risk across the enterprise and accelerating sustainable finance in our lines of business, including providing financing for utility-scale renewables and clean technologies, underwriting sustainability bonds. and innovating in ESG-linked lending.

Our path forward includes five focus areas:

The email closed by checking every box in the woke liturgy, about being—

committed to fostering an inclusive recovery from Covid-19 and to building a more inclusive and sustainable future for all.… includ[ing] supporting greater racial equity across our business and philanthropic giving and addressing evolving issues like climate change,” with a nod to the bank’s “clients and stakeholders.

This week, the bank announced it was demanding Paris-like emission cuts from companies it lends to.

This inherently conflicted, inane equivalence between and even preference for “stakeholders” (pressure groups and political interests) over shareholders and clients is, according to the Wall Street Journal, "using the ethical-custom concept to impose a progressive agenda on American businesses. It will have negative implications for investor returns.” 

Yet the costs of this public-private tag-team are far greater. For example, in late 2021 some U.S. traditional energy producers, particularly coal and related industries (e.g., rail), were unable to affordably access capital markets to purchase (or, in some cases, re-purchase) equipment to ramp up production and transport in the face of a looming energy crisis (which continues today), leading to serious energy security concerns. The companies were informed by lenders that loaning money to, e.g., coal, gave the banks an “ESG problem.” 

Wall Street, we have an ESG problem.

This resulted not from regulation but pressure campaigns including from a Biden administration that has made clear it has targeted hydrocarbon energy interests for extinction and that assisting them would not be well-received in Washington. 

Such a policy directly threatens U.S. national security. The broader consequence of greenflation has pushed prices and the cost of living upwards, and destabilized manufacturing sectors in the U.S., U.K. and Europe. It has been a major contributor to European dependence on Russian energy, undermining the West’s geopolitical position and global security. 

It has made firms worldwide increasingly dependent on China’s so-very-not-ESG manufacturing and materials. What this agenda demands of targeted industries is strongly contrary to America’s interests but is precisely as countries who wish us ill would have things.

Financial institutions draw from the same talent pool from which the Biden administration staffs itself, with the same woke priorities. This misguided partnership poses a grave danger to the U.S.

ESG and the Road to Fiscal Hell

Over at The American Conservative, Kevin Stocklin has a disturbing piece on state pension fund managers investing workers' pensions in progressive ideological projects under the guise of ESG (Environmental, Social and Governance). That's the hot trend in money management, wherein money is invested based on supposedly "ethical" criteria, rather than solely on profitability projections. In other words, the ethical evaluations of the elitist liberals working in finance are being funded in part with the hard earned money of police officers, firemen, bus drivers, garbage men, and other city employees, and all without their consent. Of course, environmentalism is a key consideration for these E.S.G. enthusiasts. Here's Stocklin:

State pension fund managers who have declared that they will include environmental and social justice goals in their investment decisions collectively control more than $3 trillion in retirement assets and include the five largest public pension plans in the U.S.... Perhaps their most high-profile success came in June 2021, when CalSTRS, CalPERS, and NY State Common Retirement Fund joined three of the world’s largest asset managers, BlackRock, Vanguard, and State Street, in voting to elect clean-energy advocates to the board of Exxon and divert its investments away from oil and gas and toward alternative fuels. All of these pension fund and money managers except Vanguard are members of Climate Action 100+, an initiative dedicated to making fossil fuel companies “take necessary action on climate change.”

As big as that $3 trillion figure sounds, it is just the tip of the iceberg:

Many state pension funds outsource asset management to firms like BlackRock, State Street, and Vanguard, which are among the 236 asset managers who signed on to the Net Zero Asset Management Initiative. These signatories, which collectively control $57 trillion in assetspledged to achieve “emissions reductions” and to cast shareholder votes that are “consistent with our ambition for all assets under management to achieve net zero emissions by 2050 or sooner.” Signatories also pledged to “create investment products aligned with net zero emissions.” True to their word, they created a lucrative industry of Environmental, Social and Corporate Governance (ESG) investment funds, ESG rating agencies, and ESG consultants.

That's a lot of scratch backing green energy projects that already have the financial and regulatory might of the federal government in their corner. You'd think that that might give them the ability to successfully compete with oil and gas, but that is not the case. Not by a long shot. The biggest problem with this, from an investment point of view, is that these ESG funds haven't done particularly well relative to the market:

A study by the Boston College Center for Retirement Research in October 2020 found that for state pensions, ESG investing reduced pensioners’ returns by 0.70 to 0.90 percent per year.... In addition, an April 2021 report by researchers at Columbia University and London School of Economics found that... that “ESG funds appear to underperform financially, relative to other funds within the same asset manager and year, and charge higher fees.”

Moreover, the Columbia/L.S.E. study also concludes that "ESG funds have 'worse track records for compliance with labor and environmental laws, relative to portfolio firms held by non-ESG funds managed by the same financial institutions.' So much for ethics.

These are big problems, especially as the states are in the midst of an unfunded pension liability crisis, a slowly unfolding disaster. To remain solvent, the states need these funds to grow. Consequently, some states, like Florida, have been working hard to impose rules which "clarify the state’s expectation that all fund managers should act solely in the financial interest of the state’s funds," in the words of Governor Ron DeSantis. Hopefully others follow suit.

Luckily for us non-public workers, Congress passed the Employee Retirement Investment Security Act (ERISA) in 1974, which banned exactly this type of misappropriation of private pension funds. However, says Stocklin, while some lawmakers have called for ERISA to be extended to public funds, the Biden administration has announced that it will cease the enforcement of ERISA rules on managers who use private pension funds towards, "environmental and social goals."

Which is to say, we're screwed.