May 1998 Vol. 219 No. 5  Editorial

Thomas R. Wright, Jr.,  Editorial Director

Apocalypse and missed opportunities

Last month, TV viewers across the U.S were treated to the ultimate in bad news / good news / bad news. We happened to tune in to a show titled "The Apocalypse and Al Gore," and were at first terrified that we had recovered from some form of prolonged haze, only to learn that the "Veep" had become president and was already pushing his version of how the world should be run. That bit of bad news thankfully hadn't come about yet, which is good news. However, the bad news returned as soon as the ABC network plunged into the gist of their presentation.

In case you missed it, we're referring to ABC's latest example of junk journalism (is that redundant?) called "ABC News Saturday Night." This particular show, which aired April 11, took on the subject of greenhouse gases and global warming. And true to network form, the presentation was loaded with innuendo, half-truths and plenty of Gore's carefully orchestrated propaganda. Some examples:

• An opening shot of Gore prophesying at the base of a glacier on labor day, complete with sunny, blue skies and water trickling off the melting ice — as if this wasn't a normal occurrence, but the disastrous effect of global warming
• Footage of the aftermath of Hurricane Andrew, which devastated Florida, with a voice-over stating that "a slight shift in temperature could very well cause severe weather (emphasis is ours)
• More video of Smith Island, Maryland, in Chesapeake Bay showing what ABC called a "steady encroachment of rising water," and including the categorical statement that "the sea level is rising"
• Still more video of Shady Side, Ohio, when the Ohio River flooded after snow that had fallen during a record year began to melt, and again a comment that weather extremes might come with global warming
• Allegations by Gore that the fossil fuel industries are lying, hiding information and formulating false science like the tobacco industry
• Insinuations that the U.S. Senate voted not to consider the Kyoto Accord because it caved in to an industry public relations campaign rather than recognizing, on its own, the problems with the treaty.

Throughout the program, ABC's Peter Jennings played straight man for Gore, offering up such musings as the industry wants more debate, so it will have more opportunity to delay action; that it takes 100 years for the earth to recycle one pound of CO₂ that man puts up there; and if we don't do something now, we will pay later.

Since we have already spent considerable space here in the past debunking the idea of global warming, we won't get into it again. But as part of this industry, you should be aware of what Gore and his ilk will do to advance their theory.

The show did have its entertaining moments, however. We particularly enjoyed a segment that was probably intended to gloat about Gore's defeat of the conservatives who questioned his fanciful theories. In this bit of video, an excited former President George Bush on the campaign stump said this about Gore, "This guy's crazy, far out, way out, man!"

Amen!

Last year, the oil and gas industry may have missed a golden opportunity to try to have import fees put in place, which would have averted much of the current price uncertainty. However, everybody was so busy smiling while avoiding the "boom" word that they forgot to think about the possibility that things could go sour again.

But think about it, conditions were just about as good as they could have been. Oil prices were above $20, the U.S. economy was booming, inflation was minuscule and consumers were unconcerned with gasoline prices, even to the point of buying more gas-swilling sport utility vehicles than ever before, not to mention the resurgence of "muscle" cars.

On second thought, maybe now is the better time. All of the above is still true, except that the U.S. economy has reached even higher pinnacles. And this time, unlike in the mid-1980s, countries such as Mexico, Venezuela, Russia and Norway acknowledge the need for production cuts to restore prices. They have even agreed to reducing output — we'll have to wait to see if they actually come through. Perhaps with this new outlook, these countries would not complain about import levies that would help strengthen world prices.

The economists also don't see substantial benefits from low oil prices at this time. Salomon Smith Barney estimates that if oil stayed at $12 per barrel for the rest of the year, the result would be a reduction in inflation of only 0.5% in the U.S and only 0.25% in Japan. Growth in the U.S. and Europe would go up only about 0.25% with continued low prices. Furthermore, Goldman Sachs said in The Economist that trade improvements due to low energy costs would amount to only 0.3% of GDP in Europe.

The Clinton administration may be more receptive to import fees for two reasons. One is the extra income that could be generated and applied to "saving" social security. Import fees from a $22 per barrel base price when actual costs are $16 would total $50.4 million per day or $18.4 billion a year on crude alone. Secondly, how could Clinton and Gore, given their fervent quest to address global warming, be against a fee that would raise the price of oil and thus dampen its demand?

Copyright © 1999 World Oil
Copyright © 1999 Gulf Publishing Company