Petroleum based business success. In a bottle. Someone call the White House...
On Monday, March 16th, President Obama and Treasury Secretary Geithner made the case for American small business during a White House press conference. It was an encouraging development for many of the small business owners and employees that help drive the American economy. However, taken together, President Obama’s plan to assist small businesses and his FY10 budget proposal send a mixed message. The summation of recent statements made by both Obama and Geithner now suggest that while they value what defines independent producers, responsible for 90 percent of American natural gas and oil wells, they are still in favor of imposing detrimental tax proposals on these American small businesses.
With a median number of 12 employees, independent producers are American small businesses by definition, and the Obama administration should have clarified their support for what natural gas and oil independents really are. The budget outline proposed by the President would eliminate eight key provisions that aid America’s smaller natural gas and oil companies. The effect would cripple the independent producers that find and provide American energy for the nation, and would negate any improvement that might be seen from the small business announcement made.
The following is a closer look at the comments made by the President and Secretary Geithner during the press conference. Continue reading
If only this were a joke.
On Wednesday, March 4th, Treasury Secretary Timothy Geithner testified before the Senate Finance Committee at a hearing on the White House’s proposed budget for fiscal year 2010. The American public has been awaiting a signal from the Obama administration about how they intend to move forward on what has so far been an energy plan that lacks details. Secretary Geithner offered some of the first concrete evidence of where America is heading. If Geithner is to be taken at his word, the American people can expect higher consumer costs, fewer jobs, and greater dependency on foreign sources of natural gas and oil.
In what were some of the most uninspiring and discouraging comments made by a top Obama administration official in regard to an energy plan, Mr. Geithner displayed a glaring lack of understanding of who America’s independent producers of natural gas and oil are, and what they do.
It is true that investments must be made in alternative sources of energy in order for them to be successful. However, the Obama administration’s proposal is not only the wrong way to achieve this goal, it is also full of dangerous contradictions. By taking capital away from American independent producers, a domino effect is started: less capital → less investment in projects → fewer wells drilled → less production of natural gas → less supply of natural gas → greater need for natural gas from other resources → higher level of imports from foreign nations → higher costs to consumers. And this is only one path the dominos will take. Continue reading