Don't let your job ooze away in all that oil, Mr. President

May 23, 2004|By JAY HANCOCK

Memo to: George W. Bush, president of the United States

From: Karl Rove, chief commissar

Dear Mr. President:

I hate to tell you this, but to lower gasoline prices we need to start letting American consumers buy oil from the government's huge, emergency reserve stores in Louisiana and Texas.

I know, I know. Last week you said, "We will not play politics with the Strategic Petroleum Reserve."

But it's time to play politics with the Strategic Petroleum Reserve. Your re-election may depend on it.

Democrats are killing us on this issue. Gas is $2 a gallon. Oil is $40 a barrel. John Kerry says you look like you don't care. Senator Mikulski says gas prices are hurting families. Senator Schumer says you're helping Big Oil and Saudi Arabia instead of American drivers.

Of course, you ARE helping Big Oil and Saudi Arabia. Prince Bandar and the folks at ChevronTexaco - the company that had Condoleezza Rice on its board - are very grateful. Very grateful, indeed. So is U.S. Oil Minister Dick Cheney.

After all, the Department of Energy is buying and stockpiling billions of gallons of crude while the world faces its worst energy crunch in over a decade. Government hoarding increases demand, drives prices even higher than they otherwise would be and boosts oil company earnings.

ChevronTexaco booked a record $2.6 billion profit in the first quarter, Mr. President, and I'm happy to say the company has already given more than $100,000 to Republicans this election cycle, according to the Center for Responsive Politics.

But now Hummers, Camrys and 747s are thirsty for oil, sir, and your government is keeping it from them, guarding it in Gulf Coast salt caves for some sort of "emergency."

How's this for an emergency? Your approval rating is 42 percent, the lowest since you took office, according to a Newsweek poll.

Mr. President, the time has come to gird your loins, steel your resolve and take the most courageous step of your life: Saying no to Uncle Dick. He'll be mad if you burn our friends in the oil industry by releasing some of the Strategic Petroleum Reserve, but you may have no choice.

Your re-election hangs more than anything else on the economy, and the economy needs a fill-up.

Greg Mankiw, head of your Council of Economic Advisers, knows how these high gas prices hurt consumers. It's as if Congress completely reversed your last tax cut and then gave all the money to oil companies. Interesting fellow, that Mankiw. I'll introduce you some time.

The Strategic Petroleum Reserve is 660 million barrels and rising. That's almost enough to supply Canada for a year. True, it's enough to last the United States only a month, but guys like Mankiw like to say that economics is most important at the margin and that relatively small changes in supply or demand can have big effects on prices.

Even 60 million barrels released from the reserves, as the Democrats are suggesting, might make a big difference. Mere word that government was thinking about tapping the reserves could rout the speculators who are causing these record prices.

Look what happened when Bill Clinton released only 30 million barrels from the reserves in September 2000 to try to help Al Gore win the presidency. Oil prices immediately plunged from $37 to $30 a barrel and were around $33 on Election Day.

True, you'll look like you're flip-flopping if you copy Clinton. But there's precedent and we have time. Plus, you've cleverly left yourself an opening to reverse course.

A month before Clinton injected reserves into the economy, the Energy Department denied that the government was contemplating any such thing. In your denial last week you said, "The idea of emptying the Strategic Petroleum Reserve would put America in a dangerous position."

Very smart, Mr. President. Nobody is suggesting emptying the reserve - only releasing less than 10 percent. When we crank open the spigots this summer or fall, we'll be able to say we didn't engage in double-talk. Slick Willie would be proud.

But we'll need an excuse so we don't look like we're caving in to Senator Schumer. Something that can be portrayed as an emergency. Maybe continuing problems in Iraq, a crisis in Israel or a terrorist attack. Then we'll draw down those salt caverns and let joy be unconfined in Hummerville.

Oil companies can borrow from the reserve, sell the petroleum at high prices and pay it back later after prices have fallen. Maybe that'll make Uncle Dick feel better.

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