Air Date 3/11/2022
[00:00:00] JAY TOMLINSON - HOST, BEST OF THE LEFT: Welcome to this episode of the award-winning Best of the Left Podcast, in which we shall take a look at the intertwining oil interests that underlie many of the decisions about Russia's invasion of Ukraine and how others are responding to it. It's a tangled mess that the US, Europe, and other nations are currently attempting to extract themselves from, but it's going to be a long process.
Clips today are from the Thom Hartman Program, Democracy Now!, The Bradcast, the Majority Report, Today Explained, and Why is This Happening?, with an additional members-only clip from UnF*cking the Republic.
Why Gas Costs So Much_ Trump, Saudi Arabia & Putin Exposed! - Thom Hartmann Program - Air Date 3-9-22
[00:00:38] THOM HARTMANN - HOST, THOM HARTMANN PROGRAM: Want to know why gas prices are so high? This is my piece from hartmannreport.com today, it's titled Exposed: The Trump, Putin & Saudi Connection to High Gas Prices. It's been a couple of years and so most people have probably forgotten that in 2020, during the pandemic, in April of 2020 as the whole world shut down, as you could look up in the sky and there were no more jet trails, vapor trails and things like that, everything went quiet, the highways were quiet, the demand for oil had collapsed so much that the price of oil was really, really low. First it got as low as $30 and $40 a barrel, and then the Saudis began punishing the Russians because the Russians wouldn't go along with production cuts to drive the price up, and so the Saudis opened their spigots and the price of oil actually, it went down to $15 a barrel here in the United States.
This is what Reuters wrote at the time, this was April of 2020, "despite the agreement to cut a 10th of global production, oil prices continue to fall to historic lows. US oil futures dropped to below $0 last week as sellers paid buyers to avoid taking delivery of oil they had no place to store. Brent Futures, the global oil benchmark, fell towards $15 a barrel, a level not seen since the 1999 oil price crash, from as high as $70 at the start of the year.
So here you have American petro billionaires, and American fossil fuel companies in a crisis. You have Putin in Russia in a crisis. 40% of his economy is based on his ability to sell oil, and the price of oil just went to $15 a barrel. And you have the Saudis who can ride this thing out, who are basically driving the train. The Saudis control enough oil that they basically control world oil prices and they were putting Putin underground here, with regard to oil prices.
So what did Donald Trump do? Donald Trump took decisive action as president in April of 2020. He called up Mohammad bin Salman, the crown prince of Saudi Arabia, and made a threat that had never been made in the history of the United States against Saudi Arabia. We've had a partnership of military and other partnership alliance with Saudi Arabia for 75 years now, in large part because we need their oil, and Trump threatened them. He said that we will pull back our military support of you guys, we will no longer support you militarily.
As Reuters wrote in a April 30th, 2020 article titled Trump told Saudi: Cut oil supply or lose U.S. Military support. This is from the Reuters article at the time, "Trump delivered the message to the crown prince 10 days before the announcement of production cuts. The kingdom's de facto leader was so taken aback by the threat that he ordered his aides out of the room so he could continue the discussion in private, according to a US source who was briefed on the discussion by senior administration officials." kevin Kramer, Senator Kevin Kramer and Senator Dan Sullivan, two Republicans get big funding from the oil industry, had drafted legislation to pull US troops out of Saudi Arabia, and Trump was using that as a threat. Immediately saudi Arabia cut production. Immediately the price of oil went back up.
So now we get to today where the price of oil is $130 a barrel and it's showing up at the pump all over the place. Joe Biden called up the Saudis and the Emirates, the UAE, the two countries that could just very easily restore their production cuts, undo their production cuts, raise the production of oil and lower prices all around the world, which would help the United States and would hurt Russia. So president Biden calls up Saudi Arabia and says, I'd like to talk to you about this and they refused to take his call. He calls the Emirates and said let's talk about this, and they refuse to take his call. They're still dancing to the tune of Donald Trump, the Saudis and the Emiratis. They're saying to the United States, through secondary channels that, yeah, we'll talk to you about lowering the price of oil, if you will tell us that bombing Yemen is just fine with you. And if you will give immunity to crown prince Mohammad bin Salman for ordering the murder of Jamal Khashoggi, the Washington Post reporter.
And of course Biden's not going to do those things, and so now the Saudis and the Emirates are basically holding the price of oil high, and this then helps them and helps the Russians this way, by holding the price of oil high, they are handing a giant lead pipe to the Republicans that they can use to bash Biden over the head with about gasoline prices here in the United. That helps get elected Republicans in charge of the House and Senate this fall. Republicans who will do the bidding of the Saudis and of Putin. And helps set up a new Republican president in 2024, who will absolutely do the bidding of the Saudis and the Russians.
This is the way that this thing is drifting. this is where it's all. And nobody's talking about the role that Donald Trump, Donald Trump's treachery, played in all this, threatening the Saudis, and then sucking up to the Saudis. Saudi Arabia was the first country he went to you'll recall. And then his son-in-law going over to that region and getting a billion dollars. It is all so mind bogglingly corrupt.
Somebody commented on my piece, this is published over hartmannreport.com, it's titled Exposed: The Trump, Putin & Saudi Connection to High Gas Prices, somebody commented on there, "why is it that these oil rich countries always end up being so corrupt?"
Russian Invasion Shows Risks of Addiction to Fossil Fuels; Will Biden Fund Shift to Renewables - Democracy Now! - Air Date 3-9-22
[00:06:31] JUAN GONZALEZ: Antonia, at the same time, the Biden administration is looking to reorient its supplies and obviously world supplies, in discussions with Venezuela. There seems to be an impetus to reach a deal with Iran and also the attempts to get Saudi Arabia and some of the Gulf states to increase their oil supplies. Both leaders of the Emirates and of Saudi Arabia declined to have phone calls with Biden, apparently, according to press reports. So is it really a shifting more toward renewable energy or is it an issue of having to reorient the supply routes in terms of oil?
[00:07:20] ANTONIA JUHASZ: There’s the short and the long term. First of all, I think it is really important to say that the price spike that we have seen immediately in the aftermath of the Russian invasion of Ukraine is not about a shortage of supply of any natural resource at this point, of oil or natural gas. It is energy traders trading on the expectation of a reduction in supply and pushing the price of oil up. The price of oil going up has immediately impacted the price of gasoline. If we regulated energy traders’ behavior, we could address that problem right now.
But the reality is right now, the expectation is that there will be a reduction in supply of Russian oil on the global market, of Russian natural gas, because Putin has already been using the supply of natural gas as a tool against Europe. So controlling the flow, the decision whether to let natural gas flow to Europe, which also has very significant impacts.
So in the short term, the Biden administration did orchestrate, which is a fairly profound shift in global energy politics. The International Energy Agency acted to coordinate its members, led by the United States, to increase oil supplies by 60 million barrels. That was essentially as a direct rebuff against OPEC’s unwillingness to do so, and that is because Saudi Arabia is aligned with Russia and trying to protect Russian interests, and is not going to put more oil into the market in order to support Russia. It is not surprising to me that the Saudis are not taking Biden’s call. I don’t think that’s going to happen.
In the short term, there is a desire to demonstrate that there will be more oil and that should hopefully reduce the stress that’s being put on the market by energy traders, and again the expectation of a reduction in supply, but I think we need to hold the administration and the rest of global leaders to their pledges, which is that they are saying, “This is a short-term solution. The long-term or even immediate-term solution is the transition [away from] fossil fuels,” and they need to be held to those statements.
Every member of the Biden administration who has spoken has reiterated that statement and they need to be held to that statement because, if anything, this war has shown us is how insecure we are based on this dependence. The United States is the leading guzzler, by far, of gasoline. The power that the price of gasoline has over political elections, people’s pocketbooks, everything in between, is an incredible weakness.
The dependence of Europe on—and I call it methane gas, not natural gas, because natural gas is about 93% methane—Europe’s dependence on methane gas has put it into this position where it is having an almost impossible time divorcing itself from Putin’s power. Being unable to do that means that there isn’t a stand to be able to take against wielding the war against Ukraine. So that incredible weakness that is created by that dependence on methane gas and the idea that methane gas should be considered a quote-unquote “bridge fuel” from fossil fuels to renewable energy, I think has been put into stark—has been exposed to be not a bridge fuel at all, but rather a continued weakness not only on compounding the climate crisis, but in continuing to support autocrats in some of the most brutal regimes in the world.
I think we need to look at the actions of the oil companies, BP, Shell, even Exxon, who have been unwinding and divesting their partnerships with Russia, and doing so with public statements in which they say that they are doing this for humanitarian reasons, they do not want to put their money behind Putin and support his war. That sentiment, the same as Biden’s sentiment in his speech, needs to be applied and thought of to all of their partnerships with all of the other countries that are wielding control over fossil fuels as weapons.
Saudi Arabia is a key example, and its brutal war on Yemen. All of the same oil companies that partner with Russia and Putin partner with the Saudis, are in deep partnerships with the Saudis. And expanding this analysis to say, “How can we unplug this power, this influence?”
In the short term in the United States, we need to be really clear. We import zero liquified natural gas from Russia. We only get about 3% of our oil from Russia, which we don’t need, and we do import some coal, but we are not reliant on any of those resources, and we can immediately lead the globe in demonstrating that our goal isn’t, quote-unquote, “energy independence.” We don’t need to be independent of other nations, but what we do need to do is make our energy sources localized and democratized so that we are using less energy by placing renewable energy sources as close to us as possible, making them democratically controlled, cooperatively controlled and operated, so that we are not simply replacing one form of extractives, massive extractives, to supply renewable energy with what we are giving away for fossil fuels, but to say that the more that we can localize our energy sources, the less dependent we are on any mass extraction or mass control of that extraction of the resource. We can do that rapidly, and we can do that right away, and we can help other nations do that as well.
[00:13:11] JUAN GONZALEZ: Antonia, I wanted to follow up on this issue of Europe’s position, though. Obviously, Europe did not follow directly with Biden’s decision yesterday. What about the issue of this Nord Stream 1 gas pipeline, and also that this crisis erupts just as Nord Stream 2 was getting ready to go into operation?
[00:13:35] ANTONIA JUHASZ: This is a war that is the first significant, well, since Russia’s invasion of Crimea, the first superpower war over fossil fuels, about fossil fuels, in the climate era, and that has dramatically changed the discussion of all of these issues. So this isn’t a war for oil in the way that the Iraq war was literally to capture oil fields and turn them over to oil companies, this is a war that is fueled by the financial support of fossil fuels, that is supporting Putin and giving him control over so much of world decision-making, but also the immediate impetus for the war was a dispute over a natural gas pipeline, Nord Stream 2.
Nord Stream 1 is the pipeline that carries a significant amount of methane gas to Europe, and it goes from Russia through Ukraine under the Black Sea to Germany. Putin has been withholding natural gas from that pipeline to Europe as he is trying to get Nord Stream 2 into action. Nord Stream 2 specifically does not go through the Ukraine, bypasses the Ukraine, so that Putin wasn’t exposed to this weakness of Ukraine’s somewhat control of that pipeline, bypasses Ukraine, follows a similar path to get to Germany. It’s built, it’s ready to go, but Europe and the United States have been trying to stop Russia’s pending action against Ukraine by not letting the gas flow through Nord Stream 2. That recent decision to not let the gas go through Nord Stream 2 was the most immediate predecessor to Putin’s decision to invade Ukraine. So in many ways, this is a war that’s about a pipeline, the flow of natural gas, and about Putin’s ability to wield fossil fuels as a weapon.
Russian oil and gas; Republican election fraud and insurrection Part 1 - The BradCast - Air Date 3-8-22
[00:15:34] BRAD FRIEDMAN - HOST, THE BRADCAST: I mentioned in passing on yesterday's BradCast that energy giant Shell Oil after making a big announcement -- was it a week or so ago following Russia's initial attack on Ukraine -- that they were going to pull out from partnership projects with Russia. They got a lot of great publicity for that. Well, then they were caught buying cheap Russian oil recently.
[00:15:58] DESI DOYEN - CO-HOST, THE BRADCAST: Seriously cheap.
[00:15:59] BRAD FRIEDMAN - HOST, THE BRADCAST: And today, well, now that they've got caught, they're really, really sorry, and will never, ever do it again. Global energy giant Shell apologized on Tuesday for purchases of Russian petroleum products and agreed to phase out all involvement with the country's oil and gas industry, even though that's what we thought they were doing in the first place. Shell made headlines last week when it continued to purchase Russian oil, despite the invasion, and various global sanctions. Ukraine's foreign minister asked the company if it smelled, quote, "like Ukrainian blood."
On Tuesday, the oil giant, facing worldwide opprobrium, seemed to say, yeah, yeah, we, we suppose it does smell a bit like Ukrainian blood. And then they announced that they would halt Russian crude purchases and shutter operations in the country, a move, which could cut Russia off from a major international customer. You know, the very thing that Shell hoped the world had believed about them after their initial announcement that they were pulling out of Russian gas and oil projects until they got caught, apparently doing the exact opposite.
Shell's chief executive Ben van Burden apologized for last week's crude purchases and said that any profits would be donated to provide humanitarian support during the Ukraine crisis. How thoughtful of him. In a statement, van Burden said, quote, "We are acutely aware that our decision last week to purchase a cargo of Russian crude oil to be refined into products like petrol and diesel was not the right one. And we are sorry." Sorry that they got caught, I suspect. He pledged to, quote, "commit profits from the limited remaining amounts of Russian oil we will process to a dedicated fund and promise to aid humanitarian agencies over the coming weeks." Van Burden said there were, quote, "incredibly difficult trade-offs that must be made during the war in Ukraine." Like, hey, should we raise our prices on consumers and buy really cheap oil on the black market to double the amount that we are screwing over the public, even as the money that we give to Russia will help them kill more Ukrainians? Even as we help destroy human civilization itself with our product? You know, incredibly difficult trade-offs that must be made during a time of war. Well done, Shell.
The actions deepen a global private sector embargo that has isolated Russia's economy over the past week. Russia's petroleum exports have diminished since it launched its attack of a neighboring Ukraine just under two weeks ago. According to the Washington Post, Shell has already suspended its operations there. At least, you know, they say they have. The Washington Post reports it as such, along with Exxon Mobil and BP, who also claimed to have done the same. Should we trust them as well? They've always done the right thing in the past.
BP also said it would not enter into any new contracts for Russian oil and gas, and that it would not charter vessels owned, operated, or flagged by Russia. French energy giant Total Energies also walked a fine line, saying that they would halt new spending in Russia, but maintain their partnership there, including a nearly 20% stake in Russian gas producer Novatek. Hey, Total, does it smell like Ukrainian blood?
Total Energy's chief executive Patrick Pouyanné said at an energy industry conference on Monday that his company would not renounce its Russian connections, noting that European governments had not directed it to do so. Which should serve as a reminder to all of us: private companies do not do the right thing unless they are instructed -- actually forced -- to do so by government regulation. Pouyanné said, quote, "I had discussions obviously with the highest authority in my country, and there was no push from them for us to exit Russia," he said, according to Reuters. Which should serve as a reminder to all of us that governments do not do the right thing unless they are instructed and actually forced to do so by the public.
Now the good news is that all of that pressure on all points does appear to be paying off. The European Commission on Tuesday announced that they in fact will be weaning off of Russian natural gas and pledged to do so by two-thirds by the end of this year. That is no small feat, since Europe, at least right now, gets about 45% of its gas from Russia.
Here was Frans Timmermans, vice-president of the European Commission, making the announcement at a press conference in Brussels on Tuesday.
[00:21:17] FRANS TIMMERMANS: By the end of this year, we can replace 100 BCM of gas imports from Russia. That is two-thirds of what we import from them. This will end our over-dependency and give us much needed room to maneuver. It's hard, bloody hard, but it's possible if we're willing to go further and faster than we've done before.
[00:21:42] BRAD FRIEDMAN - HOST, THE BRADCAST: Bloody hard, but it's possible.
[00:21:45] DESI DOYEN - CO-HOST, THE BRADCAST: Yes, it is. And it's been long time coming and they're finally getting around to actually doing it.
[00:21:51] BRAD FRIEDMAN - HOST, THE BRADCAST: US officials, meanwhile, have been looking for ways to take the pressure off of global energy markets and ease the pain of rising prices and/or profiteering by energy companies, for consumers. Analysts warn, however, there is no supplier that could easily supplant Russia quickly, given that they are the world's third largest fossil fuel producer. Oil prices hit their highest point in over a decade on Monday, as Western sanctions lasered in on Russia's energy industry. As we noted last week, however, in one of our Green News Reports, new polling from Reuters Ipsos, following the Russian attack on Ukraine, suggests that Americans at least are willing to pay more for energy if necessary in order to help Ukraine. As Reuters reported, a majority of respondents, 58%, said that paying more for fuel and gas because of the crisis was worthwhile to defend another democratic country. That was up almost 10 points from a poll that was taken just one week earlier, in the days just before Russia's assault on its neighbor.
Even just before the attack on Ukraine was launched, as CNN noted, new polling from the Pew Research Center found that Americans wanted the US to prioritize clean, renewable energy over deadly fossil fuels. The Pew results show a huge majority, 69% of American adults, favor developing alternative energy, including wind and solar, over increasing production of fossil fuels like oil, coal, and natural gas.
It also found that same huge majority, 69% again, of Americans want the US to take steps to become carbon neutral by 2050, as president Joe Biden has been seeking to do. In other words, net zero greenhouse gas emissions by mid-century.
The Republican news network, however, Fox News, you'll be shocked to learn has not gotten that message for some reason. One of their dumb White House correspondents has been pressing White House press secretary Jen Psaki for answers as to why Joe Biden was not expanding oil and gas drilling leases and permits on public lands here in the US. She told him that the industry already had thousands of permits on millions of acres of land that they were already not using. And so he should go back and ask his friends in the oil and gas industry why that is. Well, apparently he says he did. And he came back to Psaki the next day with the same question on Friday. Here's how that went for him.
[00:24:44] EDWARD LAWRENCE, FOX NEWS: Uh, so yesterday you said, you know, less oil supply, you said it again today. Uh, it raises prices. And you said ask the, um, so I asked the American Petroleum Institute about those 9,000 leases, which we were talking about. The president and CEO of that group says that a lot of policies that have been put in place by this administration, including a ban on new development of federal lands and federal waters, is really hindering American energy development during a critical time. Also, he says the royalty fees increasing on drilling discourages investments. Are there any plans to reverse any of these policies to encourage investment?
[00:25:14] JEN PSKASI: I think he may have avoided your question. I mean, because the fact is that onshore alone, as at the start of this year, the industry had more than 9,000 unused approved permits to drill in the United States. I didn't hear him speak to that in particular. And of the more than 37 million acres under lease offshore and onshore to the oil and gas industry, nearly 60% are currently non-producing. Now obviously our view on drilling over the longterm is different. I would suspect than the person you spoke to, which is that what overall we need to do here is reduce our dependence on oil. Europeans are doing that. We're doing that. And I think what we're all going through now in this discussion of banning oil imports and the volatility in the global markets, oil markets is a reminder of that. So, but there's no shortage of drilling leases that can be used domestically to enhance production in this moment. The oil and gas industry is literally sitting on stockpiled leases and permits.
Joe Biden Can End High US Gas Prices By Nationalizing The Oil Industry - The Majority Report w_ Sam Seder - Air Date 3-9-22
[00:26:10] SAM SEDER - HOST, THE MAJORITY REPORT: Here's Joe Biden announcing the other response by the international community. It's going to increase the price of gas in this country. It's an international market. It'll mean it'll create a greater demand on other suppliers, here is... But we are also just a couple of weeks away from OPEC's deal to diminish production over the past two years, in which case we may see them increase production. Although my understanding is that Saudi Arabia is not answering the phone because they're still mad that Joe Biden doesn't appreciate the the guy who chopped up a journalist being the head of their country.
Here is a Biden speaking about a ban on Russian fossil fuel import.
[00:27:04] PRESIDENT JOE BIDEN: We're banning all imports of Russian oil and gas and energy. That means Russian oil will no longer be acceptable at US ports, and the American people will deal another powerful blow to Putin's war machine. This is a move that has strong bipartisan support in Congress, and I believe in the country. Americans have have rallied to support the Ukrainian people and made it clear we will not be part of subsidizing Putin's war. We made this decision in close consultation with our allies and our partners around the world, particularly in Europe, because a United response to Putin's aggression has been my overriding and focus, to keep it all NATO and all of the EU and our allies totally united.
We're moving forward this ban understanding that many of our European allies and partners may not be in a position to join us. The United States produces far more oil domestically than all the European countries combined. In fact, we're a net exporter of energy, so we can take this step when others cannot, but we're working closely with Europe and our partners to develop a long-term strategy to reduce their dependence on Russian energy as well.
Our teams are actively discussing how to make this happen, and today we remain united, we remain united in our purpose to keep pressure mounting on Putin and his war machine.
[00:28:29] SAM SEDER - HOST, THE MAJORITY REPORT: The administration done a good job I think of maintaining some assemblance of cohesion amongst all the allies here. To be clear, this is a good example of why the idea of us upping production would drop prices, because we're already selling oil and natural gas. We're exporting it already as a country. The bottom line is when you hear people talk about increasing US oil production, or natural gas, as a way of dealing with a situation like this, they're implying this is a national security issue. Americans are paying more money, and in that instance, your response should be, I agree, which is why we should be nationalizing all of these things. They should not be in private hands, because in private hands what's going to happen is those private entities that are selling and exporting whatever fossil fuel they're exporting, they're going to say, "well, you're going to have to pay me more money if I'm not going to meet that contract over there and I'm going to meet the contract domestically, are you going to pay me more money." Okay. We'll pay you more money.
What should happen is we should nationalize every interest that we have in this country of every drop of oil that is being extracted, every bit of coal, that's being extracted, every bit of natural gas that is being extracted. In fact, all of our energy should all be nationalized. You're going to see the behavior of a lot of people in Congress change very quickly if that were the case. Would change a lot of things.
But if someone's going to push the argument, we need to drill more because it's national security issue, then the obvious response is then we should nationalize it. It is national security, we should nationalize it.
Russian oil and gas; Republican election fraud and insurrection Part 2 - The BradCast - Air Date 3-8-22
[00:30:45] BRAD FRIEDMAN - HOST, THE BRADCAST: Following the EU's commitment earlier in the day to wean off of same by two-thirds by year's end. So again, he noted, as Jen Psaki did on Friday, 9,000 drilling permits that the US oil and gas industry are not using. They have them, but they're not using them on public lands alone, which only account for about 10% of their total drilling. Even while the industry's GOP tools are bitching every day on Fox News that Joe Biden's policies are increasing gas prices, holding them back and, and, and raising the cost of gas at the pump for everyone. Lies, lies, and more lies.
But there are real things that we can do to both lower energy costs right now during this time of war. And as it turns out, help save the planet at the very same time, that according to the International Energy Agency, the IEA, on Monday, finding that Europe can do certain things to cut its reliance on Russian imports by a third by year's end. But some of these things are also things that the US can do to help as well. No, Desi Doyen?
[00:32:03] DESI DOYEN - CO-HOST, THE BRADCAST: Indeed they can. It's basically based on demand destruction. And the important thing about the IEA's 10-point strategy is that it is consistent with the European Green Deal, which means it supports energy, security and affordability, but does not support new fossil fuel development. So, one of the first things they say is -- I think this is the easiest one -- do not sign any new gas supply contracts with Russia.
[00:32:28] BRAD FRIEDMAN - HOST, THE BRADCAST: Good idea!
[00:32:29] DESI DOYEN - CO-HOST, THE BRADCAST: That's a start. Anyway, it goes from there to replace Russian supplies with gas from other sources. So you increase your non-Russian gas suppliers in the near term; introduce minimum gas storage requirements so they can build resistance for next winter into the gas system, so they have supply on hand; accelerate the deployment of new wind and solar projects that will, of course in turn, reduce gas use by a huge amount each year; maximize power generation from bio energy, like methane capture; and nuclear. And that part it includes considering postponing decommissioning of nuclear power plants until fossil fuels are phased out first.
Then enact short-term tax measures on windfall profits of fossil fuel companies to encourage them to not price gouge customers.
[00:33:18] BRAD FRIEDMAN - HOST, THE BRADCAST: Oh, there's an idea.
[00:33:19] DESI DOYEN - CO-HOST, THE BRADCAST: Yeah. Speed up the replacement of gas-fired boilers with electric heat pumps. Now these are next generation heat pumps that work really, really well in cold climates. Norway leads the world in installation of 96% of new heating systems in Norway last year were electric heat.
[00:33:36] BRAD FRIEDMAN - HOST, THE BRADCAST: And that's a big deal. Replacing all of those natural gas and oil boilers with electric heat pumps that could save alone a huge amount of money. And by the way, I've seen, I think it was Bill McKibben reported that Joe Biden should use the --
[00:33:52] DESI DOYEN - CO-HOST, THE BRADCAST: The lend-lease program, that was a big deal in World War II. Use that along with the Defense Production Act to ramp up a US-based domestic manufacturing supply chain to first supply Europe, and then build the domestic supply chain to then supply the US as well.
[00:34:09] BRAD FRIEDMAN - HOST, THE BRADCAST: Build those heat pumps, send them all to Europe.
[00:34:11] DESI DOYEN - CO-HOST, THE BRADCAST: Like we did in World War II, a huge jobs generator.
So then it goes on to accelerate energy efficiency improvements in buildings, homes, and industry, with funding from the government to do so; step up efforts to diversify and decarbonize sources of power, including electric power, so that they can interconnect the European Union grid so that countries can help each other; and then finally conservation by encouraging European consumers to use less, like lowering their thermostats.
Banning Russian oil - Today, Explained - Air Date 3-8-22
[00:34:38] ROBINSON MEYER: So the first is that, of course, is that we could move away from fossil fuels, which we have to do anyway to fight climate change. It's a big goal of the Biden administration and many governments in Europe. And as far as oil prices and gasoline prices are concerned, that mostly means switching to electric vehicles and other forms of electrified transit and public transit. And the US should invest a ton of money. Congress should pass some very aggressive climate policy. That's what we need right now. We need to start planning.
That being said, there's a few options the Biden administration has. The first, and I think the one that we're most likely to see first, is that it's going to try to reach a new deal with Iran. Because Iran has a bunch of oil that it could be producing that it's not producing right now. And it would love to get Iran back on the world oil market.
[00:35:37] SEAN RAMESWARAM - HOST, TODAY EXPLAINED: So they want to get more oil on the market, even though there isn't necessarily a shortage at present.
[00:35:41] ROBINSON MEYER: Yes. Yes. If you want to keep oil prices down, you have two ways to do it. You can reduce demand, how much oil people burn; or you can increase supply. If you do a deal with Iran, you're going to increase supply. And that's going to help keep prices low. The last thing the US could do to increase oil, to decrease oil prices, which again is not reducing the oil demand, is the US could produce more oil from the large geological reserves that it already has.
[00:36:16] SEAN RAMESWARAM - HOST, TODAY EXPLAINED: But there's also always tapping into the strategic reserve, if I remember correctly?
[00:36:21] ROBINSON MEYER: And that the US has already done twice now. So the US and other developed countries keep tens of millions of barrels of oil just sitting around in case something happens.
[00:36:32] SEAN RAMESWARAM - HOST, TODAY EXPLAINED: And something like a war.
[00:36:34] ROBINSON MEYER: Something like a war. Yeah. Or one of the main reasons for it is so that basically if there was a big war and the US participated, that the US would have enough gasoline and fossil fuels to fund its military. But it has also become used to stabilize the effect of geopolitics on global oil markets, and twice now the US in conjunction with other countries has released oil from its strategic reserve, sold it on the open market. And that has briefly lowered prices twice. The issue with that is it's just a one-time thing. You sell the oil, it goes out, it gets used, does not make a longterm effect on production.
And to some degree we're in this funny place because basically for 40 years, the goal of US energy policy was that we wouldn't be dependent on foreign oil. That we'd produce enough oil for us at home, so that no matter what was happening in the world, the US would be insulated from oil shocks. And of course at this point, the US is the largest oil and natural gas producer in the world.
We have achieved, at least on paper, this energy independence we were looking for 40 years. And what we found is that actually oil is a big global market, prices are set internationally. Oil can go anywhere in the world. A fat lot of good it's done for us. You know, like we produce a ton of oil in the United States and that has not done very much to keep oil prices down when there was trouble in the larger world.
So a lot of politicians want US oil companies to drill more, to frack more. I think that's going to be hard because fracking companies were producing too much oil during the 20 teens and they lost a lot of money, and now they feel like they need to make a consistent profit for their shareholders. And so they're actually really happy for oil prices to go up, and they're very reluctant to drill more. And so the Biden administration is going to have to control their investors to actually accept lower profits.
[00:38:34] SEAN RAMESWARAM - HOST, TODAY EXPLAINED: So it sounds like all of these solutions you're talking about, Robinson, would incrementally help eventually, but the overarching solution here to avoid crises like these would just be to become less reliant on oil, which of course has been president Biden's strategy from the jump.
Although if you were paying attention to his State of the Union last week, it seemed to be much less of priority than it used to be.
[00:39:02] ROBINSON MEYER: Yeah, definitely. And that is because a lot of the president's climate policies have just been frozen in Congress. Plans to incentivize Americans to buy more electric cars, to build out renewable electricity to power those cars. Right now that's just sitting in Congress and waiting for Senator Joe Manchin of West Virginia and Senator Sinema of Arizona to find a way to support, perhaps.
[00:39:29] SENATOR JOE MANCHIN: This is a no.
[00:39:30] ROBINSON MEYER: And so I think the White House would still love to support some of those policies, but they are so frozen. It doesn't even know how to advance them. That weirdly, even though this is the main way to reduce our long-term dependence on oil, to improve energy American energy security, it is not something that's been on the agenda so much.
[00:39:54] SEAN RAMESWARAM - HOST, TODAY EXPLAINED: It just feels a little bananas right now that the whole world is facing this energy crisis that we could solve. And yet in the moment where we could actually commit to solving it so we're never in this situation again, the solution is like, why don't we do energy diversification? The solution is like, let's hit up Iran for way more oil.
[00:40:17] ROBINSON MEYER: And it's so funny to compare it to 2008, 2007, with the last time the gas prices were really, really high, when there was this huge push to move to lower carbon electricity and lower carbon energy, because frankly, it was like the last year of George W. Bush's term, and so people were like, oh, we got to do this environmental stuff, this Republican hasn't been doing it. But because Biden's already in office and because he's already been trying to get this energy bill through, it feels like there's less of a push.
But yes, this is the thing. If we moved away from fossil fuels, then our exposure to any of these problems, just as an economy, would be lower.
And the crazy thing is not only that, but what we've already found during the past year is oil prices were going up, going to the war. And that's because the US economy was doing really well. We were adding a ton of jobs, but we were finding that there was a limit to how good the US economy could be without oil prices going up a lot.
And if we decarbonize the economy, we would take some of that limit away. We'd get rid of some of those constraints. The US economy could be doing even better.
And so there's a ton of reasons to do it. But I think it's going to take way more of a public push to turn this moment where oil prices are going to be really high into a moment where we actually successfully move away from oil and gas.
Withdrawing from Afghanistan and the Impact of Global Corruption with Sarah Chayes - Why is This Happening - Air Date 8-17-21
[00:41:43] SARAH CHAYES: It's interesting, the word has the same really deep ambiguity in every language that I can say it in that it has an English. Meaning there's both a material and a moral resonance to it, and I find that kind of interesting. But what I'm getting at here, so excuse me, if I fade back for the past year, —you know that guy Midas, the myth of Midas? He's the guy who everything he touched would turn to gold. What's so interesting is when you say in current English, someone has the Midas touch, is that a positive or a negative?
[00:42:21] CHRIS HAYES - HOST, WHY IS THIS HAPPENING: I think it's a positive, although it seems like sort of a pain in the ass if you're holding a lot of different things
[00:42:27] SARAH CHAYES: Isn't it interesting, because the story of the myth is that it's a complete catastrophe. It's a catastrophe. Why? Because it's infinite. Because everything he touches turns to gold. Because he converts everything of incomparable value, irreplaceable things like the food that we eat, the apple tree. In Hawthorne's version, his own daughter who he stoops to kiss on her forehead because she's trying to comfort him because she sees how horrified he is. And he kills her. He kills her.
I find that such a powerful myth for explaining what corruption is, let me just track it. Because what it's about is where money is not something that you need for something else. It's money that's not about enough, it's about winning. And that's an endless race. That's a race with no finish line. And the people who get caught up in that race are the most dangerous people to the human species and the rest of the planet that I can imagine. Basically—again, not to get too off track, I'm going to get back to corruption, but if you look at the climate crisis that we're all dealing with right now, and Siberia burning up, that is caused by people who are engaged in this race, and who knew back in the 1950s that this would resolve, and they lied to us about it so that they can continue making infinite... Converting the irreplaceable treasures on this earth into, not gold anymore, but zeros in bank accounts. You can think of this like a mnemonic device, whatever, a way of remembering this, it's the Midas disease. These people have the Midas disease and they're going to kill us.
So, what do they do? They almost always organized in networks or coalitions, because the rest of us, who are victims of their behavior, we're way stronger than them if we can band together and reign them in. So what they do is they band together and capture the rulemaking process, disable all of the protections that governments may erect on our behalf, and bend and repurpose, basically, government institutions and agencies to serve their networks instead of serving the public at large. So that really is what corruption is. Yes, it's the abuse of power for personal gain, but when it's really dangerous, it's not just one venal guy with his hand in the cookie jar, that's not the problem. The problem of the government officials who engage in corruption is much... Of course, yes, they steer public funds to themselves and their cronies, but I think even more importantly, they denature the function of government to serve, in perpetuity, their cronies and themselves, and at the expense of the public interest.
And what's worse is that when the public stands up to this, they deploy a really effective countermove, they deploy a number of them. But I think the most effective one that they deploy is dividing the public up along identity divides. And those identity divides can be ethnic, as in Afghanistan between Pashto speakers and Persian speakers. It can be sectarian as in Lebanon. It can be racial as here. It can be political as here. It can be urban versus rural. The problem is that we tend to organize around our identity groups, even in spite of our shared interests. Those identity group interests tend to trump, excusing the word, the, I think, much more important, shared egalitarian interest in curbing the super rich frankly, the Midas disease people, who are going to destroy the world.
so that's a kind of broad way of understanding corruption. They do it, as I say, by repurposing, by capturing revenue streams, whatever they might be. In every single country I've looked at three that are always captured our energy, finance, and high-end real estate. Those three show up all the time, and then there can be variations depending. In Afghanistan it might be pomegranates, in Tunisia was dates. Property always, I mean, that's the high-end real estate.
They capture the justice functions so that they can mete out punishment and impunity. They often capture the, usually capture, the law, the rule writing capacity. Where they don't capture justice, they work around it. So in Egypt, for example, general Sisi couldn't quite gain control of the civilian judiciary, so we just got laws passed that expanded the jurisdiction of the military courts, stuff like that.
Anyhow, then you ask, "what's an example of curbing this?" And I think one of the only examples I can come up with is the New Deal and its European counterparts in the late 1930s and after World War II. I think there were a series of laws and regulations put in place. There was a certain amount of punishment of wrongdoers, particularly in the banking sector, and there were protections put in place for ordinary people to join forces, to stand up to the Midas diseased cliques, like protections for labor organization and things like that. Antitrust. I mean, a lot of things that we don't think of as technically corruption, but anti-bribery legislation was way, way, way stronger than it is now, much stronger. Antitrust enforcement was completely different. It wasn't just about price, it was also about dominant political power and snuffing out of competition. And that all changed beginning in the very late 1970s and the early 1980s when the money maximizers started organizing again.
Peak Oil- It's a Crude, Crude World. Part 2 - Unf_cking The Republic (UNFTR) - Air Date 2-5-22
[00:49:21] Chapter Three: When you talk about oil in the United States, most people think about Texas. But the fields and refineries are only half the story. For the other half, we have to revisit familiar territory and head on back to Chi-Town.
As you heard, the oil biz was what it was until the 1970s. It grew from this point forward in volume and price volatility, until the point that Dicker mentioned in 2003, when Wall Street traders got into the action.
But none of this could have happened if it wasn’t for a good friend and protégé of Uncle fuckstick-- aka Milton Friedman-- named Leo Melamed, head of the Chicago Mercantile Exchange, or “the Merc,” for short.
Melamed took advantage of Nixon’s move off the gold standard and changed our world forever.
In 1972, Melamed established the International Monetary Market [IMM] within the Merc to facilitate the trading of currencies after President Richard Nixon repealed Bretton Woods, which removed the United States from the gold standard, and allowed world currencies to float, which we covered before.
In short order, Chicago would no longer be known as the “Second City” when it came to trading. Remember, everything currency related was fixed before this; no spreads, no margins. But Melamed recognized that floating currency meant volatility. And volatility meant spreads. And it’s in the spread that traders live and thrive.
But Melamed didn’t stop there. No sir.
The genius of what the Merc introduced was the possibility of trading futures on just about anything. This eventually included oil, which would begin on a small corner of the New York Mercantile Exchange in the late 1970s, trading home-heating oil futures.
Soon, almost everything would be fair game to trade.
The marriage of deregulation and technology over the past several decades has birthed franken-markets that influence nearly every aspect of our daily lives. From controlling pensions and mortgages, to home-heating oil and bread, traders are pagan gods, and we are their minions. Although markets today are bigger and faster, the underlying truth to the trading game is simple, proven and unwavering:
For every winner, there is a loser.
So, Leo Melamed unwittingly created a casino that allowed a highly select group of traders to wager on everything that mattered to the average consumer. It would take a few decades of deregulation, a handful of really bad decisions, made by really shitty people, and a visionary, to set the stage for a Wall Street takeover that pushed the world economy to the brink in 2008 in one of the most underreported and long-forgotten financial scandals.
Let’s start with the visionary person first:
If Leo Melamed was Bugsy Siegel, then Jeffrey Sprecher is Steve Wynn. Melamed created a comfortable niche scam that made a handful of traders very wealthy, but Jeffrey Sprecher turned commodities trading into Las Vegas and made it a force to be reckoned with.
In a wonderful book titled "The Asylum: The Renegades Who Hijacked the World’s Oil Market," Leah McGrath Goodman details the unlikely rise of Sprecher, a power plant contractor in California who “became so frustrated with the archaic ways of power trading, he wanted to make it easier for power plants, specifically his power plants, to buy and sell their electricity.”
In 2000 Sprecher approached the New York Mercantile Exchange [NYMEX], then the largest futures trading desk based in NY, with a revolutionary concept. Instead of the old fashioned, in person, pit-style trading, why not move everything to the internet, where energy futures could be traded 24/7, with complete transparency?
It was the logical-- and in hindsight, inevitable-- move, but the old school traders at NYMEX weren’t prepared to move into the future. But there was one company that understood the potential value of this when they caught wind of Sprecher’s idea. Instead of involving him, however, they essentially stole the idea and did it on their own.
That company was Enron. More on them in a bit.
Undeterred, Sprecher set about creating the technology for an online trading platform. But if he was going to beat Enron, and get this thing off the ground, he would need some massive players to move volume on his exchange. So, in 2000, Sprecher formed the Intercontinental Exchange [ICE] in Atlanta, and approached the biggest players in the game to invest. Here’s Goodman:
“In exchange for test-driving ICE, he would give away all but 5 percent of his business to thirteen of the world’s largest energy trading companies and banks. They included Goldman Sachs, arguably the most powerful bank on earth; Morgan Stanley; Duke Energy; Deutsche Bank; Reliant Energy; Shell; Total; and BP, among others.”
From the outset, the ICE was a success, but not on the scale that one might imagine compared to the much larger equity and bond exchanges. That’s because until this time, an important aspect to the commodities market was that there was always a ceiling to the transactions. Every investment made in the United States, for example, was overseen by the Commodity Futures Trading Commission [CFTC]. This market cap, and theory of transparency and regulation, kept the commodities market in relative obscurity against its much bigger counterparts.
These regulations prevented players like investment banks and hedge funds from engaging in speculative activities in commodities, because there wasn't enough money in it. There just wasn’t enough risk. Not enough upside.
What Sprecher needed to really make this thing soar was the ability to invest serious capital within the United States, like their counterparts could on the London Exchange, for example.
Call it luck, vision, or corruption, a year after founding the ICE in Atlanta, Sprecher purchased the London-based International Petroleum Exchange [IPE], and renamed it ICE Futures. It was an acquisition that was fairly straightforward, until 2006, when the CFTC - seemingly out of nowhere - officially recognized the ICE as a foreign-based exchange, because it had purchased the IPE.
So even though the ICE was based in Atlanta, backed by U.S. banks, and now traded publicly on the New York Stock Exchange, the CFTC somehow decided to treat it as if it were based in London, and thereby no longer subject to federal trading regulations.
This one small shift meant that the investment banks could suddenly trade every type of commodity, especially crude oil, without any spending limits, or federal oversight.
It was here that the wheels really began to fall off the commodities market.
Now, let’s back up a bit to revisit Enron, because something else happened while Sprecher was building the ICE that would ultimately contribute to massive fraud in the system: Recall that Enron-- the now infamous, defunct energy company, responsible for rolling blackouts in California-- was also creating an exchange.
Well, in order to accomplish this, they needed an opening. They weren’t, after all, a bank or an oil company. They had no standing, no ability, or reason to even be trading energy futures. It was a utility, and that’s not what they do.
So, to get in the game, they needed a regulatory change, a change now referred to as “the Enron Loophole.”
Under the cloak of darkness, at the end of President Bill Clinton’s second term, and the waning days of the 106th Congress, then-Senator Phil Gramm’s dusted off a bill, now commonly referred to as the “Enron loophole,” and attached it to an 11,000-page appropriations bill on December 15, 2000. The bill had previously died on the House floor, but Gramm resurrected it when pretty much everybody else was gone; he found a new sponsor, became a co-sponsor, changed the bill number, and turned it into an amendment. That’s a lot of work at the end of a year for a little loophole.
So here's what it did: the Enron loophole essentially permitted the trading of energy futures on over-the-counter [OTC] markets, thereby allowing a new set of investors -- hedge funds and investment banks -- to trade energy futures. But, as we said, these trades were still transparent, so while it allowed Enron to participate, the OTC exchanges still saw relatively little activity as compared to their European counterparts, where the oversight was far more lax.
It should be mentioned that Phil Gramm’s wife was former CFTC chairperson Wendy Gramm. The Gramms knew the rules inside and out; they knew exactly what they were doing when they shoved this loophole into the regulatory bill after it was already written and vetted by the Senate. In fact, very few people even knew Gramm inserted the language into the bill at the time.
As Goodman writes: “The loophole, which applied to complex financial instruments, as well as the over-the-counter energy market, had allowed trillions of dollars of credit-default swaps to go completely unregulated, causing global banks to fall in on themselves like dying stars. The Enron loopholes had worked like an enchanted tonic. After it was approved, U.S. crude-oil and natural-gas futures volumes leaped 90 percent in just five years, with the number of traders betting on the market more than doubling, according to the U.S. Government Accountability Office. But the real victory was off-exchange, in the over-the-counter market, where Wall Street traders drove commodities volumes up 850 percent to an estimated $3.2 trillion in the same five-year period, according to the Bank for International Settlements.”
After Wendy Gramm left the CFTC, and five weeks after creating this exemption, she became a board member of -- you guessed it -- Enron. In return for her work deregulating the market for Enron to exploit, she racked up millions as an Enron board member prior to the company’s collapse.
The Enron Loophole outlived Enron and opened the markets to a flood of cash from sources that had never before contemplated such massive investments into commodities. Commodities and investments like CDOs and derivatives, the financial packages that would collapse the housing market in just a few short years and bring the American economy to its knees. Between the Enron Loophole, Sprecher’s invention of the ICE, and the Bush administration’s mind-blowingly irrational decision to consider the ICE a foreign exchange, and therefore exempt from any U.S. regulation, the stage was set for another historic meltdown.
Final comments on the rising demand for clean energy action in the wake of the invasion of Ukraine
[00:59:31] JAY TOMLINSON - HOST, BEST OF THE LEFT: We've just heard clips today, starting with Thom Hartmann explaining the links back to Trump threatening Saudi Arabia on behalf of Russia that have all become quite relevant again under these new circumstances. Democracy Now! explored the dependency of Europe on Russian oil and the power dynamics that creates. The BradCast discussed Shell buying Russian oil and Europe divesting from it. The Majority Report talked about Biden banning imports from Russia and the need to nationalize our oil production. The BradCast also looked at ways for the world to move away from dependence on Russian oil more broadly. Today, Explained also looked at a bit of an all-of-the-above strategy for transitioning away from fossil fuels. And Why Is This Happening? with Chris Hayes looked at the role of corruption and the Midas disease in fueling climate disaster.
That's what everyone heard, but members also heard a bonus clip from Un-F*ing the Republic doing a deep dive on the history of oil and oil markets, which is a lot more interesting than it sounds, and not just because they swear on that show.
To hear that and have all of our bonus contents delivered seamlessly into your new members-only podcast feed that you'll receive, sign up to support the show at BestoftheLeft.com/support or request a financial hardship membership, because we don't make a lack of funds a barrier to hearing more information. Every request is granted. No questions asked.
And now, just to wrap up, I want to put a finer point on the fact that it seems Russia's invasion of a sovereign nation and rising gas prices are doing something all the IPCC reports in the world couldn't: broadening acceptance of the idea of a fossil fuel-free, or at least fossil fuel-minority energy future. Now of course, there's going to be a giant push from the right to drill more and do away with regulations of any kind. So it is critically important that rhetoric be answered and drowned out by a giant movement of people like you. Now, unfortunately, there isn't a specific direct action to point you to right now, though we are hopeful that that is in the works.
What we're asking you to do today is get dialed in. Find your local chapters of climate action organizations like ThreeFifty.org, Extinction Rebellion, Sunrise Movement, Mothers Out Front, and start going to events, meetings, teachings, and webinars. If you don't know already, find out who your local state legislators are and start writing to them, advocating for investment in renewable energy, public transportation, bike lanes, and more, in your state. Also be sure to call out any politicians taking fossil fuel money. We've included links to help you take all these actions in the show notes. Because the fact is, the climate movement has answers to nearly all of the concerns of this movement. So let's take advantage of that and change the trajectory of our collective future.
As always, you can keep the comments coming in at 202-999-3991, or by emailing me to [email protected]
That is going to be it for today. Thanks to everyone for listening. Thanks to Deon Clark and Erin Clayton for their research work for the show and participation in our bonus episodes. Thanks to the Monosyllabic, Transcriptionist Trio, Ben, Ken, and Scott, for their volunteer work helping put our transcripts together. Thanks to Amanda Hoffman for all of her work on our social media outlets, activism segments, graphic designing web mastering, and bonus show co-hosting.
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So coming to you from far outside the conventional wisdom of Washington, DC, my name is Jay!, and this has been the Best of the Left podcast coming to you twice weekly, thanks entirely to the members and donors to the show from BestoftheLeft.com.