Central planning: A method of economic regulation in which investment, production, and resource allocation are coordinated according to a comprehensive national governmental plan. (lexico.com)
Democrats love the idea of central planning, not that they always and fully practice it. When given the opportunity, any opportunity, they become giddy at the prospect of meddling in the most intimate economic decisions. The Green New Deal is a classic in this control-freak genre of economics. It’s understandable. After all, let’s not forget that they are the defacto socialist party in America.
However, I must admit that the Trump-populist subspecies of Republican are intoxicated by it in their newfound affection for centrally planned tariffs in an attempt to resuscitate a 1950’s mythical ideal.
Still, the Democrats have essentially cornered the market in zeal for grand government plans to engineer a world that better suits their prejudices. And like the now-deceased Soviet Union, they’ll fail as the unintended and disastrous consequences pile up. We’ll live the disaster. Regardless, Biden and fellow Democrat big cheeses are blissfully strolling down the path blazed by the USSR.
Indeed, the examples are piling up. To address high gas prices, Biden and his people conjured the idea of increasing the supply by allowing more ethanol in the blend. Watch for shortages and price jumps in corn meal, anything made with corn, its processed derivatives (sweeteners, etc.), all complimentary goods (meats, baking goods, machinery, ingredients, seeds, fertilizers, etc.), and substitutes (other grains such as wheat, rice, oats, soy beans, etc.). And to think that the $6/gal. fuel was itself a result of Biden’s day-one executive orders to attack anything that would make more crude oil available in demanded volumes (XL pipeline, bans on federal leases, tax threats, an EPA run amok, etc.). It’s a politically-engineered theater of the absurd.
And here’s another kicker: our refining capacity hasn’t changed much since 1977, the year of the construction of the last major refinery. NIMBY’s, byzantine environmental reviews, and orchestrated hostility to fossil fuels has throttled the ability to turn the crude into affordable road trips and brimming supermarket shelves. Instead, we get sermons to go electrical in a glorified golf cart or $60,000 Tesla. Mind you, nothing is physically wrong with the conventional family sedan – it being made more fuel efficient and less polluting over the years – it’s just that these wunderkinds have a visceral hate for the lifestyles of soccer moms, the ‘burbs, and RV-vacations. Under Biden, the bigotry gets a chance to be translated into policy.
Right now, the public’s focus is on shortages of everything from gasoline to baby formula, all of it trucked. Think of the container ships piling up outside San Pedro, but don’t forget that the price of diesel is running a $1 more per-gallon than gasoline on an already inflated price base. Today, it takes $700-$800 to fill up the required 150-gallon tanks on the big rig. Some loads aren’t cost-effective and can’t be made outside bankruptcy proceedings. Shortages!
So, Biden catered to eco-fantasies of his base and threw everyone else wild curve balls. One of those batters in the box receiving the wild pitch is the oil industry. The oil companies, like everyone else, have a survival instinct. They have sensed over the recent years an infantile dislike for them among half-witted cultural elites. As a result, they have increasingly tried to get on the “sustainable” bandwagon: biofuels like algae, etc. You’ve seen the ads. So, scarce refining capacity is devoted to them. A Shell refinery (La.), a Tesoro refinery (Ca.), the HollyFrontier refinery (Wyo.), the Western Refining refinery (N.M.), and the Dakota Prairie refinery (N.D.) have responded to the political heat by restricting crude oil processing and a shift to the greenie will-o’-the-wisp.
Sending less gasoline from the refinery to the pumps is just one aspect of the problem. Some refineries have simply called it quits. The Philadelphia Energy Solutions, the largest refinery on the East Coast at 335,000 barrels per day, is slated to fall under the wrecking ball soon. Lyondel Bassell’s refinery in Houston (263,000 barrels processed per day) is scheduled to close its gates by December 2023.
Some are being strangled in the crib. The largest and newest proposed refinery, Hyperion Energy’s facility in South Dakota, is drowning in bureaucratic delays and an environmentalist insurgency. Economic late-term abortions in the energy sector are becoming commonplace.
Tack on federal and state taxes – a dollar per gallon in California alone – and we have a pile-on for pump sticker shock and Walmarts with empty store shelves. If you’re a climate-change hysteric, you must love misery. Biden is proving that environmentalism is a sadistic religion.
*Read Jim Geraghty’s piece on the subject.
RogerG