The price of oil is dropping...are we still on board with the Pickens Plan?
With the price of oil dropping, somehow I think we may lose interest in the Plan.
Certainly the speculators got on the oil bandwagon for the last two years or so
and drove the prices up and just as the tech bubble burst, so will the price of
oil. World demand for oil did not triple in the last few years. But the world supply
of oil will rise and be subject to the whims of those who have the oil.
The price will likely continue to drop for the short term....
This is a wake-up call to have energy independence in this country. The
wind and solar options should be explored. Meanwhile there is plenty of natural
gas available to us in the US. It is a clean fuel and ought to be used to the
fullest.
It will take many billions to implement a clean , domestic energy system.
Complicated tax incentives or the like ought to be avoided. The best way to
transition to energy independence is the go to the FairTax system as soon as
possible.
The FairTax is a national sales tax that will completely repeal and replace the
income tax. The FairTax seeks to end the income tax and simply collect the tax
at the point of retail. Considering that all the income tax we pay is included in
the cost of what we buy anyway, it is not that big a change.
Just to implement the income tax costs us $100s of billions per year. The savings
we will see when we go to the FairTax will allow us to pay the higher energy costs
while also investing in the Pickens Plan. The FairTax costs very little to administer.
You can learn more at www.FairTax.org.
Complicated tax incentives sound good but are really very costly and may not
work.
Thanks
Views: 0
Replies to This Discussion
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Permalink Reply by Lee K. Shuster on -
The Energy Bulletin report provides an incisive analysis explaining why we’ll continue to see peaks and valleys as oil production declines.
Read: Crude Oil Price Retreat: Sunrise or a Lull Before the Storm?
or
http://www.energybulletin.net/node/46199
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Permalink Reply by Peak Dad on -
For what it's worth, I believe the Energy Bulletin website is one of the most reliable sources of energy info on the net.
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Permalink Reply by Warner on -
The price of oil has risen so fast and now seems to be retreating that one can
only attribute it to speculation getting out of hand. We have seen bubbles like
this in tech and biotech too. I think the next one will be in health care but that
is just my opinion.
We can see this as a short term trend with little significance or a wake-up call
to fix the problem now before the next scare comes along.
As I write this oil is down about $1.50 for the day. Gold is down over $20 and
the dollar is getting stronger.
That is why we must get Mr Pickens' ideas in gear now. Natural gas will
replace a lot of foreign fuel and we will worry less about regional conflicts
which may distrupt supplies.
We may see a continuing trend toward downward prices as the public
drives less and uses various conservation methods.
We may even see a huge glut of oil as various new methods of extraction
become available.
That should not deter us from the goal of having energy independence as
soon as possible because China and India will be soon competing in a big
way for the world's available oil.
,Thanks
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Permalink Reply by David Baker on -
Good points Waren,
But you lost me at the end. I'm not sure I understand the relationship between the tax system you are advocating, and the transition from our dependence on foreign oil to domestic energy production.
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Permalink Reply by Warner on
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Greetings,
The Pickens Plan and the FairTax are both grassroots efforts to correct
problems we have here and now.
My contention is that the PickensPlan is a good one but will require
lots of effort and capital to see it though. I also believe that the rising
costs of energy which ripple through the economy will make
paying for the PickensPlan difficult. I suggest we adopt both the Pickens
Plan and the FairTax. The FairTax is a national sales tax which will repeal
and replace the income tax. What we seldom think about is that the
income tax itself costs us $100 of billions to administer every year.
What we also dont think much about is that all the income tax we pay
is included in the price we pay at the cash register for any item we buy.
Why not just tax us at the cash register and end the income tax?
Every working American would see a huge savings immediately.
Just look at your pay stub. Look at the tax that is withheld for the
income tax and FICA. Under the FairTax you would keep that money to
help you pay bills for today.
Prices would not actually rise because the hidden taxes inherent in the
system would be gone. Costs for the FairTax are a small fraction of the
tax.
See www.fairtax.org for more information.
Under the PickensPlan we can have clean, domestic based energy
Under the FairTax we can save the many billlions it will cost to
achieve the Pickens Plan. I believe this idea is better than other
kinds of tax schemes which will benefit lawyers and accountants
but will not benefit the average citizen.
Thanks
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Permalink Reply by SJC on -
If people are so fickle that they hop on and off when the price of oil goes to $100 per barrel in January, $145 in July and $115 in August, then they are not in it for the long run anyway.
The Pickens Plan is going to put in 600 wind turbines, not 6000 nor 60,000. Oh some day maybe someone will put in 6000 or 60,000, but not right away. Trucks and buses may convert to NG, but they would have done that anyway.
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Permalink Reply by Mathew Andresen on -
If we respond to this decline in oil prices the same way we did the last one, then IMO we deserve what we will get. Namly a wrecked economy in a couple years when oil hits $200, then $300 a barrel.
Basing our entire economy on the infitie use of a finite resource is beyond foolish.
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Permalink Reply by SJC on
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We were lulled in the 80s and 90s by North Slope, North Sea and Saudi oil flooding the market. We also had the implied notion that the executive branch would protect our sources of supply for oil. This time around, things are different.
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Permalink Reply by Warner on
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Actually the FairTax is a good idea. It is difficult to respond to your assertions
because they are a bit non-specific to say the least.
We do need to find serious solutions to our energy problems and it will require
funds in the hundreds of billions.
We need to find the waste and remove it and the FairTax will save us many
billions because it gets rid of the very wasteful income tax. It is not the only thing
we must do but it is a start.
See www.fairtax.org for more details.
Thanks
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Permalink Reply by Warner on
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Well, no it is not just a slogan. Many people are now realizing that the
FairTax is the way to go.
It is a fact that many billions are wasted paying to comply with the income tax.
All those billions are passed on to the consumer in the form of higher prices.
The FairTax taxes at the point of retail as a one-time single tax. No one
can avoid it unlike income taxes in which people hide sources of income and
avoid the tax.
You will pay your taxes when you make a purchase just as you do now. All
taxes are already passed on to the consumer anyway.
Most importantly the FairTax will spur investment in the new technologies
we need to have energy independence in this country.
We still have those energy bills to pay while we transition to a more
domestic energy base. The FairTax will offset those costs while we transition.
We lose a lot of money because domestic companies go overseas to
avoid tax liabilities here in the US. The FairTax will help solve those
problems.
What I am saying is: we just cant afford the income tax system any more.
The PickensPlan will take time but the FairTax will save us money as soon
as it is passed.
See www.fairtax.org.
Thanks
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Permalink Reply by Mathew Andresen on
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I have to agree. Without getting to far off topic. As both and economist, and a CPA. Going to the Fair tax would be one of the best things we could do as a country. It would free up around $200 billion in tax compliances costs.
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