MSNBC hosted "McCain supporter" Frank Donatelli to discuss offshore oil drilling, did not mention his former post as energy lobbyist
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SUMMARY: On MSNBC Live, Andrea Mitchell discussed Sen. John McCain's call to end the moratorium on offshore oil drilling with RNC deputy chairman Frank Donatelli, but did not mention that Donatelli was a registered lobbyist for energy sector clients ExxonMobil and Dominion Resources before joining the RNC.
Appearing on the June 17 edition of MSNBC Live to discuss Sen. John McCain's call to end the moratorium on offshore oil drilling, Frank Donatelli was identified by anchor and NBC News foreign affairs correspondent Andrea Mitchell only as the "deputy chairman of the Republican National Committee and a John McCain supporter." Mitchell did not note that, prior to his post at the RNC, Donatelli was a registered lobbyist for energy sector clients ExxonMobil Corp. (Page 7) and Dominion Resources.
Donatelli lobbied on behalf of Dominion from 2002 to 2007 while at McGuire Woods Consulting. In 2007, Donatelli was one of six McGuire Woods lobbyists listed as having represented Dominion for the following "[s]pecific lobbying issues": comprehensive energy bill, overall electricity legislation, offshore drilling legislation, tax legislation, and pipeline safety. In 2006, Donatelli was also one of five McGuire Woods lobbyists listed as having represented Dominion on the same issues. Senate lobbying records show that Donatelli lobbied on behalf of ExxonMobil from 1998 to 1999, while working for Akin Gump Strauss Hauer & Feld.
On the June 9 edition of MSNBC Live, Mitchell discussed energy policy with former Sens. John Breaux (D-LA) and Trent Lott (R-MS) but failed to disclose that both are lobbyists for major oil and gas companies.
From the 1 p.m. ET hour of the June 17 edition of MSNBC Live:
MITCHELL: John McCain is in Texas today to deliver a major speech on the energy crisis. The senator is expected to push for offshore drilling in a state where oil is a multibillion-dollar industry. But the senator's plan might not resonate as well across the country. So, joining us now, Frank Donatelli, deputy chairman of the Republican National Committee and a John McCain supporter. Frank, good to see you.
DONATELLI: Hi, Andrea.
MITCHELL: Well, how does he straddle this issue of "you can have states permit offshore drilling," but he's still against drilling in Alaska. And he's -- doesn't he risk offending the environmentalists and not really satisfying the oil industry?
DONATELLI: Well, Andrea, I guess I would say that it's a balanced plan, but we have a crisis. We have $4 gasoline, heading even higher, and we have to do something about that. That's impacting our economy; it's hurting families. And what Sen. McCain has said for a long time is, in the long run, we need different sources of energy. We need green and new technologies.
On the other hand, we have a short- and medium-term problem, and part of the solution there is additional drilling to find additional oil and gas supplies in the United States. And the Outer Continental Shelf is the way to get some of those supplies to market fairly quickly. I would just note that it would require the concurrence of the states to drill off of their shores, but if you incentivize the states properly, this is a potential source to moderate gas prices.
Now, I would never imply that there is some sort of collusion among the Saudis and the Republicans and the Oil Companies. I'm just sayin'......
I am not sure how identifying Donatelli's resume more thoroughly would have made him appear any different, or anymore of a partisan supporter of McCain. - tommy
Those surprised by tommy's inability to grasp the point here, raise their hand...
I am not sure how identifying Donatelli's resume more thoroughly would have made him appear any different, or anymore of a partisan supporter of McCain. But if so, go for it. - tommy / Wednesday June 18, 2008 3:02:26 PM EDT
You can't see how not identifying a former Exxon lobbiest as such would change how an audience might percieve his opinions on offshore oil-drilling? Really?
So, he is clearly identified as a Republican operative and a McCain supporter, isn't that enough to show bias towards McCain and his positions for you?
It is for me.
I am not sure how identifying Donatelli's resume more thoroughly would have made him appear any different, or anymore of a partisan supporter of McCain. - tommy
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Come on, Tommy. That's lame even for you.
Not disclosed? They are saying he is a "deputy chairman of the Republican National Committee and a John McCain supporter"
You don't think that is showing bias, you're not serious?
I will type slowly in the hopes you can grasp it.
The oil industry ties represent a different bias than the one disclosed regarding his ties to McCain.
I know you will still pretend not to get it...
"So, he is clearly identified as a Republican operative and a McCain supporter, isn't that enough to show bias towards McCain and his positions for you? It is for me. - tommy / Wednesday June 18, 2008 4:56:11 PM EDT"
It shows his bias toward drilling in currently protected areas. Your original statement was "made him appear any different, or anymore of a partisan supporter of McCain." You've now switched your statement to apply only to the second half of your original statement. Further, McCain has gotten mileage out of how he is different from many other Republicans on matters of the environment (his position on offshore drilling has only recently morphed), so the fact that he has a former Exxon lobbyist pushing his new pro-offshore drilling position is relevant.
Huh?
Whatever. The point MMFA is feebly trying to make is that Mitchell left out information to make this Donatelli guy appear less partisan and more credible. When in fact she very explicitly states he is a Republican and a McCain supporter, so in the context of their discussion on oil he will agree with McCain, and he is biased, for exactly the information Mitchell divulges.
Enough is never enough for MMFA sometimes. It is for us who can clearly see the bias in this guys statement. Sorry it isn't for you.
"The point MMFA is feebly trying to make is that Mitchell left out information to make this Donatelli guy appear less partisan and more credible."--tommy
Is Exxon a political party?
I am merely pointing out that mentioning the Exxon connection does not really have anything to do with the supposed "partisanship" of the remarks. It might also reveal some of the other motivation for his remarks - outside of his political support for McCain.
Personally, I think it helps to explain Donatelli's positions in even better terms than his political support for McCain. It would be good if the audience had that info to decide for themselves.
Why? Donatelli isn't running for office, he is an RNC member and a McCain supporter, and he is speaking in support of McCain on off-shore drilling, he is identified clearly and his comments, biased comments, should be taken under that consideration. If he was not identified and put forth as some unbiased source, you'd have a point. But he is not.
"Why?"
Because Donatelli is on the TV on a news show. News shows should not be in the habit of lax disclosure that may help viewers understand the remarks contextually.
So it's about all of these things regarding McCain, not Donatelli?
"Appearing on the June 17 edition of MSNBC Live to discuss Sen. John McCain's call to end the moratorium on offshore oil drilling, Frank Donatelli was identified by anchor and NBC News foreign affairs correspondent Andrea Mitchell only as the "deputy chairman of the Republican National Committee and a John McCain supporter." Mitchell did not note that, prior to his post at the RNC, Donatelli was a registered lobbyist for energy sector clients ExxonMobil Corp. (Page 7) and Dominion Resources.
Donatelli lobbied on behalf of Dominion from 2002 to 2007 while at McGuire Woods Consulting. In 2007, Donatelli was one of six McGuire Woods lobbyists listed as having represented Dominion for the following "[s]pecific lobbying issues": comprehensive energy bill, overall electricity legislation, offshore drilling legislation, tax legislation, and pipeline safety. In 2006, Donatelli was also one of five McGuire Woods lobbyists listed as having represented Dominion on the same issues. Senate lobbying records show that Donatelli lobbied on behalf of ExxonMobil from 1998 to 1999, while working for Akin Gump Strauss Hauer & Feld.
On the June 9 edition of MSNBC Live, Mitchell discussed energy policy with former Sens. John Breaux (D-LA) and Trent Lott (R-MS) but failed to disclose that both are lobbyists for major oil and gas companies."
McCain sure doesn't show up a lot, but Donatelli and his possible motivations sure do.
Well, obviously you had trouble reading it the first time, so I thought I would point out that "McCain" is not spelled D-O-N-A-T-E-L-L-I.
No, seriously, I know it's just the usual assertion that even though the article doesn't mention anything of the sort, you know the real reason it was posted. Your mind-reading powers continue to amaze and astound.
MSNBC had on a former energy company lobbyist, specifically to speak about offshore drilling, but only announced his Republican, pro-McCain credentials.
Contrary to your assertion, MMFA was not making this just about McCain. For example, the other information noted in the thread's introduction: "On the June 9 edition of MSNBC Live, Mitchell discussed energy policy with former Sens. John Breaux (D-LA) and Trent Lott (R-MS) but failed to disclose that both are lobbyists for major oil and gas companies" touches McCain not at all but is wholly germane to the media's frequent reticence to identify corporate lobbyists as such.
If someone is going to speak to a specific issue, then it is wholly reasonable to expect to be informed what expertise and/or potential conflicts of interest that person may have on that specific subject. A person's basic political affiliation is not always enough.
Personally, I think it helps to explain Donatelli's positions in even better terms than his political support for McCain.
How is that? Donatelli is a former lobbyist which most likely means he receives no compensation from ExxonMobil anymore. Thus, it is unlikely as a FORMER lobbyist (former is the part that y'all cannot seem to grasp here), has any financial incentive to push the ExxonMobil agenda. As a matter fact, what would be more relevant to any possible bias would be whether he owned shares of ExxonMobil but you never hear the media talk about anyone's stock holding when they introduce them (except for CNBC). Thus, if Donatelli has no financial incentive to push a position for ExxonMobil, isn't it just possible that he simply believes in what he is saying? I know if I were a lobbyist, I would not take on business from Greenpeace or PETA. I would lobby for causes that I either was neutral about or supported. What MMFD is pushing for here is an implication that a logical analysis does not bear out.
The audience should decide for themselves the relevance of the information.
Lobbyists frequently switch between working in government and back into lobbying in order to maintain access to decision makers. Donatelli can easily use his exposure to improve his cache when/if he returns to lobbying. To pretend Donatelli's lobbying past is entirely irrelevant or not possibly financially rewarding is simply either disingenuous or naive.
Secondly, it is understood that most lobbyists are "true believers" in what they are lobbying for. The audience should be aware that Donatelli is likely an evangelist for his point of view as lobbyists and former lobbyists frequently are. Inclusion of the pertinant information gives context to the remarks. I am actually pretty surprised anyone would want to keep this information from the viewers.
"[MMFA] immediately start hollering that the media is biased."--financebuzz
I must have missed that part of the MMFA article above. Then again it may just be in your fevered imagination.
: )
It's to expose conservative misinformation. Readers can draw conclusions about the viewpoints of certain journalists from the number of articles regarding them, but MMfA does not assert "bias" in said articles.
I knew I should have typed more slowly. Oh well.
And this is the reason I'm always amazed that other posters defend you here when you are clearly intellectually dishonest.
Oh spare me your whining. You can't argue your point convincingly so that has you irritated. Tough.
Feel free to ignore what you find intellectually dishonest, please.
Avoidance of the 'L' word, either deliberate or not, has a direct bearing on Donatelli's own personal interest and the interest of McCain, not just Donatelli's preference for president. In this case, his interest is boatloads of oil money that he and all his sleezy lobbyist friends get in return for corrupting Washington.
Apathy toward such contemptible people and those in the media that provide them a platform without such disclosure may be acceptable for you, but not for those who can appreciate this type of exposure on the part of MMFA. We would not have to depend on organizations like MMFA to provide such disclosure if the media would give us the whole story.
I mean, holy cow, CNN and the other cable crap channels run 24 hours a freakin' day. Are they so tight on time that they can't be bothered with what you believe are such petty details?
Since when is the media, who in this case clearly identifies their guest's current political affiliations and who they support politically, required to go back through their guest's resume and also list their employment history, even if it is past employment as in this case? How far back do you want them to go, one year, two years, five years, ten years, college days?
Mitchell obviously felt she was disclosing enough, I agree with her. If you don't then we have a difference of opinion.....it's hardly some nefarious plot to keep all of you in the dark.
Actually, in addition to being completely wrong on the basis of basic journalistic ethics, I disagree with you on how not disclosing this helps McCain.
By not disclosing his former ties, the media is, yet again, covering up for McCain and his cornucopia of lobbyist connections.
You're bringing up "required" again in another vein attempt to portray MMFA and its supporters as nonbelievers in freedom. In this case, freedom of the press. No, they are not "required" and neither myself nor MMFA are saying that they are. This is about a journalistic duty to deliver the whole story, the choice or ability of whether or not to perform that duty, and exposure when that choice or ability is not exercised.
As far as employment history, it's a question of relevancy. Accepting money from big oil companies in exchange for corrupting our elected leaders over a period of nearly twenty years up until 2007 is relevant.
I mentioned nothing of a nefarious plot on the part of Mitchell or CNN. I clearly said "deliberate or not" because I didn't want to make that determination. But if you insist, I believe its journalistic neglect and/or incompetence.
Accepting money from big oil companies in exchange for corrupting our elected leaders over a period of nearly twenty years up until 2007 is relevant.
Do you have any evidence of corruption or are you just imparting your opinion of lobbyists here? Here is the way I see it. Corporations are significantly impacted by the laws enacted by government at all levels. However, they do not directly have representation. ExxonMobil as an entity does not have a vote. Thus, since they are impacted by government action (as are their employees, customers and suppliers, in turn), why is trying to express their wishes and desires to the government wrong? Do you have a problem if liberal organizations lobby or is this just a manifestation of the liberal bias against the oil industry?
I don't care if they're paid by an oil company, Wal-Mart, NOW, the AMA, a labor union, or the F'ing Sierra Club. High-dollar lobbyists are the scourge of our government, and I view them all with the same contempt.
I have some respect for the ones who operate on a shoe-string, who finance their own trips to Washington, and who do nothing but lobby our lawmakers, not shower them with golf trips, hookers, parties, and God knows what else.
Liberal bias from the government against oil companies???????? How in the hell then do you account for the massive amount of corporate welfare oil companies get which makes their 10% profit margin wholly different than any other corporation. If the government was out to get the oil ocmpanies then they sure as hell wouldn't be making record profits off our backs while we have men in the field of battle, sir. I thinks you Republicans are drawing a line which you will not be able to defend if you continue with this nefarious position that the poor ol' oil companies are getting hosed by government. In fact I hope you continue with that line of reasoning. Sooner or later you are going to have a hard time convincing even the most ardent blue collar conservatives of this crap. Keep defending $4.00 a gallon gas through compassion toward big oil. You'll lose everytime trying to convince a working man that it's o.k. to gouge them.
How in the hell then do you account for the massive amount of corporate welfare oil companies get which makes their 10% profit margin wholly different than any other corporation.
How is it welfare? Welfare would be giving corporations something that is not there. I know the left thinks that my money belongs to the government, but it doesn't anything that allows those who earned the money to keep more of it, I most likely support.
Sooner or later you are going to have a hard time convincing even the most ardent blue collar conservatives of this crap. Keep defending $4.00 a gallon gas through compassion toward big oil. You'll lose everytime trying to convince a working man that it's o.k. to gouge them.
So we should be celebrating that we are capitalizing on economic ignorance by caving into those who do not understands forces impacting the economy, both positive and negative.
Boo hoo for corporations. They are not people (despite what Scalia would tell you). Their entire existence is possible because of the system set up and maintained by the government and, by extention the American people. There is no free market vacuum, our government creates and backs the currency and provides (or should) a healthy, trained, educated work force and consumer market. Furthermore, if those regulations you decry did not exist, those companies would not last very long in such an anarchist system (look at Enron, Arthur Anderson, Bear Stern, S&L's, etc.).
The oil industry is one of the biggest welfare queens in our country, so nobody is interested in their sob story. They don't even come close to paying the true cost of their business. They get the land pretty much for free, they pay virtually nothing fot the environmental damage they cause, both during their operations and during the use of their product; they pass that cost back to the government. They receive billions of dollars in subsidies and tax breaks from the federal government. And they have one of the highest profit margins of any industry, so what exactly do they want in addition to that and why on earth would they think they are entitled to such?
It appears they've settled on the word CRISIS to call what's happening to energy costs.
Why then do they keep suggesting increasing supply to meet this CRISIS, when in fact there is no "shortage" of oil and gas, and therefore there is no "shortage" causing this rise in energy costs?
If it's not a "shortage" causing these high energy costs (and it isn't), then how does increasing supply do anything about it?
It doesn't.
It's simply taking advantage of the high energy costs, of the CRISIS, by implying that there's a "shortage" of some sort (when there obviously isn't), and therefore implying that supply should be increased.
It's just an excuse to siphon off the oil on Federal lands. It's not a supply problem, and so it doesn't require a supply solution...
It's a Regulatory problem, and requires a Regulatory (CFTC) solution...
Why doesn't anybody even bother to cite the obvious truth: that the rising prices for oil that you keep seeing mentioned everywhere every day, is the price of "oil futures contracts", as they are bidded up and up and up, on the commodities exchanges?
It's got nothing to do with supply, and it actually has nothing to do with oil either: the prices you and I see rising in leaps and bounds every day ($140/bbl) are the prices of "oil futures contracts"
There is no supply problem driving energy costs up, and so no increase in supply is going to do anything about it.
Well anyway, at least they've settled on a word that implies a "shortage" that doesn't even exist: CRISIS.
I haven't seen lines at any gas stations, or any rationing, which you would expect if there really was a shortage. This also seems to torpedo the favorite Republican "refinery bottleneck" talking point. Plenty of gasoline.... plenty of crude..... rapidly escalating prices..... record profits for the oil companies....... Riddle me this, Batman......
Hey folks, problem solved! There's oil in them thar bugs! Scientists (not of the creationist variety!) have created a bug that eats wheat and shits oil. Now all we have to do is solve the wheat shortage, and we're golden!
Oil futures contracts are relatesd to future projectiions of supply and demand, not existing. So even though there is no supply issue today it is the projected supply and demand that is causing the price spike.
The price we are paying at the pump does not reflect the price of the gas in the stations tanks, or even that in production, but the price required to satisfy the futures contracts the oil companies hsve purchased to satisfy our future needs. That is why the gas price does not reflect the the barrell price on a daily basis.
By reducing it's dependance on foreign oil US producers will reduce their requirement for foreign purchases. Removing a major player from the daily futures bidding should bring down the futures pricing, but even if it does not, the overall price we are paying will decrease as the average price per barrel US producers are paying will drop.
No, under current law, the oil companies are under no obligation to sell any oil sucked out of US earth back to the US. It would go on the world market unless Congress were to change the law. I believe this law was enacted several decades ago when the Alaskan North Shore started going full force.
"the more you have, the cheaper it is."--ssands
Not true. Supply is only half of the equation. I believe I have corrected you on that before. ...And you call Obama stupid? Hahaha. Now that's funny.
"obama says by approving drilling now, it won't reduce prices immediately. well, that's like saying you plant corn today, you won't have anything to eat tonight. he's right. right, but stupid as a brick."--ssands
That looks like a strawman - can you please link to the place you are quoting Obama? Thanks.
Economists agree that such a relatively small increase in world production would not affect prices much if at all - regardless as to when they go into full production tomorrow or a dozen years from now - as is projected.
It is merely a campaign gimmick played by McCain on apparently gullible people.
"Removing a major player from the daily futures bidding should bring down the futures pricing, but even if it does not, the overall price we are paying will decrease as the average price per barrel US producers are paying will drop."--dems sol
What leads you to believe the new oil drilled off the US coast will be sold at a lower rate than foreign oil? That does not seem to be the case with oil that is being produced today in the US. What is the basis for your statement? Is it just an opinion of what you hope will happen?
as the average price per barrel US producers are paying will drop
That was the line that made me laugh, too. For a group so opposed to entitlements and handouts, cons sure don't feel any shame at constantly begging the question.
"it is the projected supply and demand that is causing the price spike"
It is not: and everything you wrote is nonsense, especially the emphasis on the word "projection", which as you use it, is obviously meant to mean "a pretended imagination of the future, that has no real relationship or even any resemblance, to the present"
You want to know what it is commodities traders are doing, when they bid the price of oil futures contracts up and up and up?
The first thing they're doing, by purchasing a contract to buy something in the future, and then sell it in the future, without ever actually taking delivery of the commodity, or even seeing it ever... what they're doing is INSERTING THEMSELVES, AS A MIDDLE-MAN, INTO A TRANSACTION BETWEEN THE ACTUAL PRODUCER AND ACTUAL USER, OF A COMMODITY.
Read it again, because it's all right there: what commodities futures traders do, when they hold contracts on commodities that they will never take possession of, but will merely "hold the paper on" and own, between the time that commodity is produced and the time it is consumed, is INSERT THEMSELVES INTO THE TRANSACTION AS A MIDDLE-MAN...
Not unlike what health insurers do, when they insert themselves between you and your Doctor, without ever even seeing you or him, or practicing health care or medicine in any way shape or form.
What else are these commodities futures contract traders doing?
They are driving up the prices of the contracts they trade in, by buying and selling those contracts up and up and up, in some cases buying for themselves the very same contracts that they already own, and overpaying, so as to drive the market price of the futures contract up and up and up (there being no loss at all, in overpaying for something, when it is you yourself you are overpaying)
Why are they doing this?
Because ultimately when those inflated contracts (inflated by a mad selling and re-selling, up and up and up, often sold to themselves for just that inflating purpose)... when those inflated contracts are ultimately sold to someone else, the high price shall then become an obscene profit: all as a result of having speculatively driven the commodities futures contract up and up and up, by controlling and cornering the market in those contracts...
It's what's being done with oil futures contracts, and they're trying to imply a "shortage" to cloak what it is they're doing... and you know what else? It's being done in food commodities futures also... they are likewise trading up and up and up, the prices of the futures contracts they hold, and implying a "food shortage" behind which to hide what they're doing.
Both problems are the same problem, being driven by the same people, in the same commodities exchanges.
It's a Regulatory problem... our Commodities Futures Trading Commision is allowing it to happen... and you know why don't you?
Because they're appointed by and overseen by President Enron, that's why!
This is exactly what Enron did, years ago... it's deja vu, all over again.
You were making some good, but very debatable points in your post until you wandered into the conspiracy theory BS. Start here and do some more research.
http://www.dentonrc.com/sharedcontent/dws/drc/opinion/columns/stories/DRC_Williams_Column_0529.3e61f8dd.html
No thanks, because I already know, and wouldn't waste my time researching your strange misperceptions and false opinions in the matter.
And it is a conspiracy, but not a theory.
Aren't you even aware that the Senate Subcommittee on Financial Services and General Government is holding Hearings on what I explained to you (which I guess was as wasteful as feeding strawberries to a pig)... that Senate Committee is investigating exactly what I explained, and hearing testimony from the CFTC and the various commodities exchanges, this very day they're doing this, you don't know that?
You need to send them your link... you need to help them out with your strange misperceptions and false opinions in the matter: because they're the ones uncovering this conspiracy, and it's no theory either!
that Senate Committee is investigating exactly what I explained, and hearing testimony from the CFTC and the various commodities exchanges, this very day they're doing this, you don't know that
Just as they haul oil exec's in front of a committee every time oil goes up and gas prices spike. What is the result? Absolutely nothing because the conspiracy is in the imaginations of people who do not understand markets. Politicans grandstand so they can appear to the public to be doing something - usually by the time the committees are done the public has moved on so very few notice the lack of results.
Interesting column, but not really useful in proving or disproving anything about speculation in the commodities market. The problem with that column is that it oversimplifies how the commodities market really works. In Williams' scenario he describes commodities trading as if they were transactions like consumers make in which they pay for goods or services and then actually receive them. That is not what a commodities trader/speculator does at all. He buys the option to buy the commodity, thus locking it up and preventing anyone else from buying it in the future. Then he tried to re-sell that option at a higher price. A more apt analogy would be a ticket scalper who buys the entire lower deck of a hot concert, creating a completely artificial drop in supply, then jacks up the prices for those seats in order to make a profit. At no point in the transaction did the scalper want the tickets or have any intention of using them, he just wanted to use them as a quick road to profit without having to go through all the trouble of producing a marketable good or service himself.
A speculator is a scalper, not a producer nor a consumer.
I like that as an analogy or comparison: it's like scalping tickets, and being a ticket-scalper... it's inserting themselves into the transaction, between the actual producer of the commodity (the one who puts on the show or ball-game that the ticket is for), and the user of the commodity (the one who goes to the show or ball-game), and in the process, increasing the price of the ticket (or commodity) as much as they can, slicing out as much middle-man profit for themselves as they can...
What commodities traders are doing with oil futures contracts is like ticket-scalping: true.
And what they're also doing, is trading these commodities futures contracts back and forth among themselves (sometimes even selling those contracts again, to the one who already owns them), bidding the price of those futures up and up and up...
That's like a ticket-scalper taking a ticket with a face value of $40, and selling it to himself for $80... and then selling it again to himself, for $160... and again, for $320 (and not losing a penny, because he keeps overpaying no one but himself)... and then when he prices it for some sucker, he says it costs $320!
"That's the market price, look right in the financial section of the paper: it's selling for $320!"
That's what's going in, not only in the commodity of oil, but in other agricultural commodities as well, driving prices up, all by the same people in the same commodities exchanges, but simply in different commodities.
And just like in the sky-rocketing prices of oil futures contracts, they try and imply there's a "food shortage" driving the rising food commodities futures contracts as well...
It's a lie.
It's the same people, in the same commodity exchanges, doing the same thing, in different commodities... and then making the same lies and false excuses ("shortages") in both cases.
Ticket-scalping is in most places I believe, illegal...
What's going on in the commodities futures markets is negligently going on unregulated, by a Commodity Futures Trading Commision that is supposed to work for the American People, but isn't, obviously.
A more apt analogy would be a ticket scalper who buys the entire lower deck of a hot concert, creating a completely artificial drop in supply, then jacks up the prices for those seats in order to make a profit.
That scalper is taking a risk that his total supply will be in demand. I personally have used their services and by waiting until an hour before the show I usually pay BELOW face value and avoid all the BS service charges. Recently a Jimmy Buffett show in Houston sold out 10 minutes after the tickets went on sale. A week brfore the show you could fetch tickets on Ebay for half of their face value.
But you do provide an excellent supply and demand opportunity. The scalper you reference prices can only hold up as long as the promoter does not add any more shows to the venue. Once more shows are added the scalpers demand decreases and so will his prices. He may eventually have to sell some tickets as I noted above below face value.
Yes, the scalpers/speculators do run the risk of gambling wrong and losing in the end, but that is not the point. They serve no useful purpose in the market. They do not produce, they do not distribute, they do not advertise, they do not store product for future use, they are neither wholesalers nor resalers and they add nothing to the product or service they are leeching their profits from. They are artificial and unnecessary and pervert the market.
Williams' put forth the theory that speculators somehow act as a control on consumption because of how their activities artificially manipulate prices. Besides this being merely his unproven opinion it flies right in the face of conservative logic that supply and demand alone will control conrumption through the invisible hand of the free market. So what exactly do the speculators do? Especially in oil, a product that will most likely not see any significant drops in demand for at least a decade.
The scalper may make it possible for you to get front row seats at a premium price because you were unable to get them at the on sale date, but he has prevented someone else who was able and ready to get them at that time. He is a monkeywrench in the ointment, exerting artificial pressures on both supply and demand and altering the price by his behavior.
So what exactly do the speculators do? Especially in oil, a product that will most likely not see any significant drops in demand for at least a decade.
Let me note that I do not like, nor do I care to defend specultors (or scalpers for that matter). The Williams article attracted my attention for that reason. Many speculators these days are investment fund managers who are in it to make money for their investors and while I believe some regulation could tame them, you can't totally lock them out.
I used to work for Tenneco, a gas supplier,. The speculators and traders would by units of gas for future delivery. If their target for delivery was December and it was June and they anticipated a rise in prices, they would buy a contract for December delivery at June's price. As the market fluctuated between June and December they would trade those contracts so they could deliver gas at the cheapest price to their customers in December.
Oil futures contracts are relatesd to future projectiions of supply and demand, not existing. So even though there is no supply issue today it is the projected supply and demand that is causing the price spike.
Ridiculous. Speculators are bidding up the paper price of oil for one reason .....greed sir. That's why the futures traders moved from the United States to London in 2003.... to escape oversight. That's why contracts went up from 13 billion to over 200 billion in 7 years. They could give a damn about supply or demand. Those guys are bidding on how much profit they will make. Of course let me not forget the other factor of the de-valued dollar caused by our huge deficit (Iraq War) and turmoil in the middle east (Iraq War). Ben Stein indicated that he was in a room with futures traders yesterday and watched as they laughed and joked about how they are controlling oil prices for huge profits. Even idiots like O'Reilly get this. I am amazed as to how you defend this type of overt corruption, especially when our country is at war.
The price we are paying at the pump does not reflect the price of the gas in the stations tanks, or even that in production, but the price required to satisfy the futures contracts the oil companies hsve purchased to satisfy our future needs. That is why the gas price does not reflect the the barrell price on a daily basis.
True to an extent, but you are basing your whole argument on the premise that the speculators have no interest in profit. It has nothing to do with analysis of our future needs sir. It has everything to do with a worthless dollar and greed.
By reducing it's dependance on foreign oil US producers will reduce their requirement for foreign purchases. Removing a major player from the daily futures bidding should bring down the futures pricing, but even if it does not, the overall price we are paying will decrease as the average price per barrel US producers are paying will drop
Here is a better idea. How about regulating futures trading in the market to stop the gouging we are getting daily. Your insane to believe that we can drill our way out of this mess.
True to an extent, but you are basing your whole argument on the premise that the speculators have no interest in profit. It has nothing to do with analysis of our future needs sir. It has everything to do with a worthless dollar and greed.
I don't disagree with your assessment of the component regqrding the dollar and greed. The futures business is a gamble and with the worlds oil reserves focused so narrowly these days it is almost a sure bet. I believe, not fact, that once the US shows serious interest in developing significantly more of it's own supply prices will drop, and that same greed that is driving up the price now, will have those speculators dumping their contracts to keep their losses at a minimum.
Here is a better idea. How about regulating futures trading in the market to stop the gouging we are getting daily. Your insane to believe that we can drill our way out of this mess.
Before I buy into your regulation theory show me where regulation has worked with world market commodities. Do you think the Chineese and Indian commodities brokers will follow US regulations? I do not believe we can drill our way completely out of this mess but it will provide some relief while we continue to pursue alternate fuels. I do believe things will have to be different this time. If I were king I would include in my recovery and production contracts requirements for advanced development of alternative fuels.
Well, given the fact that before the speculators moved to london contracts totaled 13 billion when there was oversight and now that they are at the ICE in London that amount is over 200 billion. Gas prices were lower before many speculators figured out they could go overseas and escape regulations. That would be a starting point for such proof. Here is some information you may find interesting. Look, the government has restrictions on commodities and futures markets right now. Has the sky fell in those markets?
http://www.ireland.com/newspaper/breaking/2008/0618/breaking8.htm
http://news.bbc.co.uk/2/hi/business/7460310.stm
http://www.mcclatchydc.com/economics/story/41360.html
I love this though "One of McCain's close friends and top advisers, former Sen. Phil Gramm, R-Texas, pushed through legislation that included deregulating energy futures at the behest of the now-defunct Enron Corp., which among other things manipulated futures prices.)"
I'm sure you read this from your first link, which is why I am skeptical of regulationg world commodities.
Expectations that more regulations on ICE trading will tame prices "are likely to go unmet," Mr Vice said.
US regulators are feeling heat from US lawmakers to rein in what they see as excessive speculation in commodities markets, which they believe is the culprit behind record crude oil prices that have risen nearly 40 per cent since January to record highs near $140 a barrel.
CFTC Acting Chairman Walter Lukken, whose agency is conducting a nationwide probe of crude oil markets, conceded that "the environment is ripe for those wanting to illegally manipulate the markets."
However, the top US futures market regulator said there was no "smoking gun" that indicates that speculators are to blame for record oil prices.
Democrats on the joint Senate panel said the CFTC lacks enough information to make that determination.
Also remember, the Chineese, Russians, and Indians are now major oil consumers, as opposed to when prior regulations existed.
These speculators know that without America's thirst for oil there is no way that countries with thirld world wages like in Russia, China, and India would be able to sustain 130 dollars a barrel.
You are exactly right - Which is why becomming less dependant on foreign oil, by producing more of our own, will drive down the price. Which is why I believe that as soon as the US commits to increased homeland production, the high price bubble will burst!
If it were economical to go after the oil you mention - then it would be done. I am not stating fact here - just for discussion purposes , if it costs $20 a barrell to get the oil out of ANWAR and $100 a barrell to get it from the areas you mention that could be your answer. When I moved to Houstin in 1990, oil was selling at $18 a barrell. Eighteen months ago oil was at an all time high of $60 per barrell. It's now at $130. Facts have changed dramatically in a very short period of time.
You've also wandered into another area of contention - and that is the refining capacity. We don't have it right now but as part of a comprehensive plan it needs to be expanded. Without that it doesn't matter how much oil we pull out of the ground - if we can't refine it it will just stockpile. I already mentioned that if I were king I'd do things differently than they are being done today and I don't have all the answers - but to shut the door on our own resourses does not make much sense to me.
You hint around the edges of something very important about oil exploration and recovery here, the connection between the price per barrel and the methods and places used to get it. There are methods of drilling that can get yield from wells called "dry" that are simply beyond the point of it being cost effective to continue to work them. This also goes for shale oil, which is not a new discovery at all, it is only now that the means of getting the oil from the shale have advanced technologically while at the same time the price of more conventionally drilled oil has risen that getting oil from shale has become potentially profitable.
Could something similar be happening with oil futures now?
Of course, we could just assume that these people have our best interest at heart and would never lie to us.....
The "drill here,drill now, pay less" crap has been good enough for the zombies for a few weeks, but I just got the first sign that the righty media may be aware that they need some fresh BS.
Some facts are being pointed out more frequently, maybe not in the MSM, but from the non-GOP news sources, that the number of existing oil drilling areas, permits and leases on domestic oil sources that are capped or not being used debunks the simple supply & demand explanation.
I heard Rush Limbaugh as I went to lunch today, promoting the "drill now..." cheer, but as he went to commercial, he added a little preview-- (paraphrasing);
"The Democrats will tell you we have existing oil wells we're not using..." . the next words weren't even a complete sentence, something like " those are short term leases that don't work with EPA guidelines"
OK, I wasn't saying they had a complete talking point yet, but it's interesting to see the manufacturing of the propaganda. If there are any "Drill here (etc.)" proponents posting, and I've misunderstood Rush's point, please feel free to correct me. I may just be ignorant on this issue.
That is, what is the difference between the new areas that the oil companies want to establish rights to, and the existing ones that are not being exploited?
I don't buy the "Rush Limbaugh is only an entertainer" schtick. He's a paid propagandist, pure and simple.
just because they have a lease on lands, does not mean the lands have oil and gas worth exploiting. my wife's family in south texas has a ranch. there have been oil and gas leases, but minerals were not available in commercial quantities. so no one drills them. the first step is exploration, then development. you can't develop what is not there.
the most money they ever got from oil and gas companies was bonuses for the right to go on the property and conduct exploratory activities.
btw, colonel, as for bustamante, i have a proclamation signed by the lt. gov. himself, dated 12 may 2001, commending meon the work i did for the natural history museum of l.a. county.
no i wasn't
I'll vouch for Sandybuff here. He wasn't hiding his identity any better than he does anything.
But Sands, I think you missed the point of my question. I wasn't asking for somebody to state the obvious, or to come up with a plausible apology for the GOP or oil industry. A child could have done that.
What I wanted was an explanation of the seedling of a talking point that Rush was testing out, the EPA remark. Some specifics, not hogwash or twittering generalities that depend on every assumption one could make to defend the Oil industry and their GOP concubines.
But congratulations on your commendation from Bustamante.
Anybody familiar with "Smoky Joe" Barton? He was on the Teevee a couple of days ago spouting that same crap about drilling. And he and his crony Republicans were saying "we can get gas prices down to $2.00 a gallon".
This does seems to be a new (albeit crappy) talking point.
It's sad to see how intolerant the GOP has become of this poor racist button vendor. So much for the "big tent". Lol.
; )
We're at war. And we've been told to shop.
I've got six hundred bucks to spend.
1. Who cares what his former job was? My former job was with one of my current company's major competitors? Should everything I do in my new position be questioned because I used to be employed by our competitor? Does that invalidate the work I do now and the views I hold in my new position? Furthermore, do you expect to be believe that no Democrat staffer has ever been employed as a lobbyist or working for as an environmental or some other liberal cause activist? I do not recall seeing too many Dem staffers being identified with their former positions when introduced? In fact, is it typical to go through someone resume when introducing them?
2. I am not a former energy lobbyist and Donatelli said exactly what I would say. Pursuing green and alternative options are fine but they will not be here overnight and that is not political but reality. We need to have a solution in the interim and that is fully use our resources to prevent further damage to our economy. Yet the Dems (and some Republicans, including McCain) stand in the way of this and apparently are willing to have us continue to pay $4 oer gallon for gas rather than deal with reality and try to find solutions for this nation. This should be bipartisan and the Republicans who are being obstructionist are just as dead wrong as the Dems are.
1. It depends on context. I assume you are not on the nightly news, so I don't care what your former job was.
2. If you were on the show instead of Donatelli no one would complain - unless you left out pertinant information of your employment past.
How quickly do you think oil/gas prices will drop after drilling is allowed (you can forget California - Schwarzeneger is dead set against it) assuming Florida goes along with it? What is the basis of that speculation? Why do you think oil companies will sell their US offshore oil lower than everyone else?
they would slit each others throats to make a buck. that's business. - sands
That, in a nutshell, is what the "free market" means to these people. What's the problem?