Neighborhood Ministries

Many people complain about the high cost of gasoline but do not realize the full impact that high oil prices have on the economy.  Many companies rely on parts to be shipped to them and most stores have goods shipped to them. Increases in gas prices increases the cost of shipping and raises the cost of goods at the store. In addition, many people commute to work and increased gas costs increases the cost of getting to work. In addition, many homes and businesses heat with oil and the higher cost oil also increases the cost of heating. Yet few people getting raises to cover the higher cost and many people are seeing cuts in hours as businesses try to cut costs. In 1974, I worked for the welfare department (now Job & Family Services). Gas jumped from $.50 a gallon to $1.00 a gallon overnight when the Arab States raised the cost of oil. A 100% increase in cost. We were dependent on them for oil at the time and many companies went out of business and a lot of people were thrown out of work. My caseload increased from 150 cases to 250 cases within a year and I had to take time off my caseload one day a week to do intake on new clients. Though the increase is not as fast today, it is still hurting an economy already hurting due to the poor economic policies of the current administration.

When President Biden took office, he cut of construction of the pipeline from Canada  and cut back American oil production. He said it was to protect the environment but it merely transferred the problem to the countries that produce the oil and increases the risk of  pollution because the oil has to be transported overseas by tankers and runs the risk of oil spills. Pipelines are safer because the pipeline is underground and isn’t subject to storms and collisions. The only justification for shifting to overseas oil is that it sends the profits to the Arab States instead of keeping them here in the United States and Canada. In addition, the Canadians turned to China to sell the oil that the United States would not be buying, since the Canadians already have a pipeline to the West Coast, which benefits China. In addition, it hurts us because it costs American jobs and the Arab States use the profits to support terrorism. However, the biggest problem is the threat that is not obvious. When we became dependent on Arab oil, it allows them to raise their prices since they don’t have to compete with American produced oil. The Arabs are now doing that further threatening America’s unstable economy. Since we have discontinued the pipeline construction and cut our own production, we can’t just increase production to force the price down. It will take time to reopen the wells and complete the pipeline.

President Biden has been talking up how gas prices are dropping slightly. While he is responsible for the price drop, I wouldn’t be proud of it if it were me. Prices are dropping because people are driving less. They are being hurt by the high price of gas and by inflation, so they are limiting their driving. Gas stations are lowering their prices to encourage people to drive more. President Biden has been draining our oil reserves to bring down oil prices but it is leaving us short on reserves if we face another hurricane like Katrina that shuts down the offshore oil wells. The Canadian pipeline was supposed to provide a backup but President Biden shut that down as well so we have no backup if our oil supply is threatened. President Biden has figured out another way to control the price of gas and that was to extend the time allowed to use fuels containing ethanol.  It creates a lot more pollution than regular gas, so it is restricted in summer when people do the most driving.  Gas with 70% ethanol was promoted in the beginning because ethanol is made from plants which are renewable so we would use less gas but it required that engines be specially made to handle it so it can’t be used in older cars that weren’t made for it. It gained a lot of support from environmentalists concerned about us running out of oil, but they turned against it when they found it created more pollution. Many embraced it because it was 40-50 cents less a gallon until they realized they got a lot less miles per gallon, so it really wasn’t the bargain it appeared to be. I used it for a while because it was cheaper until I found it was actually costing me more for gas every week due to the reduced gas mileage. Not many people use it anymore, so few stations carry it. Some stations use gas with 10% ethanol. There is usually a sticker telling you but most people probably don’t notice it. Overall, it probably won’t have much effect on gas prices and most people won’t realize the reduced gas mileage, so it is mainly a publicity stunt before the elections to make it look like he is trying to solve it in order to counter his failing popularity.

President Biden is desperate to contain rising gas prices that have reached a 40 year high and are still climbing. He is trying stopgap measures that help for a few days or a week or so but don’t deal with the underlying problem. We need to get the pipeline restored and our domestic oil production back online so we are not dependent on foreign oil. President Obama cut American oil production and forced us to depend on foreign oil under the pretense of protecting the environment and gas prices reached over $4.00 a gallon. President Trump restored American oil production and made America free from dependence on foreign oil and prices dropped to around $1.75 a gallon. When President Biden was declared the winner, prices jumped to $2.60 a gallon in anticipation of President Biden cutting American production. Since President Biden cut American production and cancelled the pipeline, gas prices have continued to climb and have reached a 40-year record high. He has created a situation in two years that President Obama did not create in his eight years. That doesn’t even count the risk of oil shortages due to dependence on foreign oil and the fact he is draining our reserves leaving us at risk in case of war or natural disaster. We are dependent on Russia and Iran and are not on friendly terms with either. Russia only supplies a small amount of our oil and has caused us a major headache. Iran supplies most of it and has already cut off our supply once in 1974 and gas prices doubled almost overnight causing widespread business closings, high unemployment, and long lines at the pump due to gas shortages. Do we want to face that again? We need to elect people to Congress and the Presidency who will put America first.

Everywhere I turn, people are talking about the high cost of gasoline. As oil prices increase, businesses are forced to pay the increasing cost of shipping and must pass it on to the consumer through higher cost of products. Consumers must pay the higher cost of gasoline for getting to work and other important business, as well as the higher cost of products they buy. In addition, Americans are paying rising prices for home heating, yet many are not receiving any pay raises and many are facing reduced hours at work as companies must cut back production due to lower sales. President Biden turned from American oil to foreign oil setting off rising gas prices. He has now released oil from our reserves for the third time under the pretense of dropping the cost of fuel. Each time has been followed by a drop in prices for a couple days and then they return to rising. Oil is purchased on future estimates of oil available and draining our reserves does not change that. It will hurt us if we are drawn into a war or have a major hurricane shut down oil platforms for a while, or there is a break or malfunction in the pipelines that deliver oil. Energy independence instituted by President Trump lowered prices and helped protect us from the danger of oil shortage. As long as we are dependent on overseas oil, we are subject to higher prices and the threat of oil shortages.

The move by President Biden to cut American oil production also endangers the U.S.  by shifting a great deal of America’s oil source to Russia and Iran. That makes us dependent on Russia and the Arabs who could cut off the supply if they want to hurt America, or if we go to war with them. We saw that in 1974 when we were in a similar dependency and the Arabs cut off the supply to the U.S. Gas prices jumped 100% from $.50 to $1.00 a gallon overnight and we saw widespread shutdowns of many major businesses. They could threaten us with cutting off the oil supply as they are currently doing with Europe which doesn’t have the oil reserves that we do. We are seeing our European allies reluctant to support actions against Russia because they are totally dependent on Russia and Iran for oil and know if they push too strongly, Russia could cut off their supply of oil threatening their economies. By cutting our oil reserves, it makes us even more vulnerable to blackmail because we would have fewer supplies to draw on in case they cut off the oil. Russia is raising the price of oil and could cut it off to the U.S. causing a shortage of oil. If so, we could see real raises in oil prices and possible shortages at the pump. That would not have happened if we had remained independent of foreign oil. It also leaves us more exposed to natural disasters. We saw rapid rises of prices and shortages at the pump in the East when hurricanes devastated Texas oil refineries and when the cross-country oil pipeline failed preventing normal distribution of oil across the country.

Many people are upset at the rise in prices at the gas pump. Gas is almost double what it was a year and a half ago. By canceling the pipeline and restricting American oil production, it forced the oil companies to turn to Russia and the Arab countries to make up the difference. Since then, the price of oil has steadily risen and the money for the oil is flowing into their coffers, not into the American economy. Foreign oil costs more and leaves us vulnerable if they decide to raise the price of oil. President Trump had expanded America’s oil production and freed us of dependence on foreign oil cutting oil prices from $4.00 a gallon under President Obama to $1.75 a gallon. Now it is over $3.30 a gallon again and rising. We have seen a new rise in oil prices as the United States faces off with Russia over the Ukraine and Russia raises the price of oil. President Biden made another stupid move in an attempt to shore up his failing presidency. He released oil reserves from the national reserve in an attempt to drive down rising oil prices. It has been attempted in the past and never reduced gas prices because gas prices are based on potential supply and drawing on reserves does not increase the potential supply. It actually reduces the potential supply and resulted in price increases.