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Oil Crisis: Helping The Public & The Country

I guess we can all agree that the oil business is highly profitable. Wouldn't you agree with that statement? Of course you would.

Given that our nation is almost broke; wouldn't it make sense for our government to begin exploring new ways to create new revenue streams without raising taxes? I think that would be wise.

In fact, many countries are already using oil as a means to prosper their nations by profiting off of the rest of the world. The two countries that come to mind are Venezuela and China. Both countries control their state owned oil companies.

Given the energy crisis we are facing in the U.S., maybe its time we should adjust the way we think.

Heck, I would even bet our politicians love Venezuela's President, Hugo Chavez. Despite all of their jaw flapping, they are allowing Venezuela to sell gasoline to U.S. consumers through their state owned oil company Citgo. In addition, Mr. Chavez has helped more of our nation's poor than our own government by selling heating oil at a discount to America's needy.

Here is a quote from golbalpulse.net;

"Citgo Petroleum Corp. has already given 16 million gallons of heating oil at a steep 40 percent discount to 181,204 low-income households in Connecticut, Delaware, Maine, Massachusetts, New York City, Philadelphia, Rhode Island, and Vermont."

"When city or state governments refused to deal with Citgo, a subsidiary of Venezuela's state oil firm PDVSA (Petróleos de Venezuela, S.A.), the company worked with community groups. In Chicago, Citgo offered free bus passes to low-income residents, the Journal-Sentinel said."

Is there any wonder why our oil backed politicians are hell bent on getting rid of this guy? It seems as if Hugo Chavez is making our politicians, and oil companies look bad. In addition, he is bad for business.

Now, Chavez may have a screw lose, I am not deigning that. Then again, we have to remember there are 2 sides to every story.

So, I ask, what is wrong with the U.S. Government getting into the oil business? We have all agreed it is highly profitable. Are you not tired of hearing about the huge profits these companies and their executives are making?

Now before you start screaming Socialism or Communism, you need to understand that our government really does not look down on this. We do business with Socialist or Communists everyday.

You might think that “state owned” oil business would control oil prices and the free enterprise system, but our Government does that very thing right now.

Oil is as essential to our economy as water, electricity, and natural gas. Like it or not, we already have a system in place that regulates utilities like water, electricity, and natural gas and it is called the public service commission. If these utilities are regulated, why should big oil be any different?

A state owned Oil Company in the U.S. could never happen given the control that big oil has over politicians. Would a state owned oil company be profitable for the nation? It would right now.

As we speak, the U.S. Army is spending about $266 million dollars a day, or $8 billion a month fighting a war in Iraq. The Iraq war has cost a total of $300 billion thus far. If that same money had been invested in mothballed refineries, and a few oil companies, the profits would be flowing right now.

To show you how much $300 billion is, if the U.S. government had taken that money and bought Unocal for $17.9 billion, they would have had an oil company, a refinery, and $282.1 billion leftover. In fact, that same $300 billion spent in Iraq could have bought almost 17 Unocal’s.

The profits of owing 17 refineries and oil company’s would go a long way toward paying off our national debt and shore up the deficit.

HOW BIG BUSINESS & POLITICIANS RATIONALIZE

Wall Street and politicians love communists. Yes, I think that is quite obvious. They love China and Vietnam since they are good for big business in the United States. Any communist nation that is not good for big business, Wall Street, and our politicians are known as “bad communists”.

So, as I watch the embracing of the “good communist” (China and Vietnam), and the condemnation of the “bad communist” (North Korea and Cuba), I am reminded of a phrase from the "Wizard of Oz"; "Are you a good witch or a bad witch?”

Among the "good communists", it is estimated that about 58,000 of our servicemen were killed in Vietnam (with support from China and Russia) , and during the Korean War, China joined with the North Koreans on November 26th, 1950 in fighting a military offensive against General MacArthur and the American military. From 1950-1953 it is estimated that over 30,000 American soldiers were killed in battle.

So, the now "good communists", were either directly or in directly responsible for the killing of around 88,000 American soldiers. I guess our politicians and big business don't care that this happened since they love to trade, and outsource American jobs to Vietnam and China.

Let’s focus on the "bad communists". Korea with the help of a good communist, China, was responsible for 30,000 American deaths, but another bad communist, Cuba, was responsible for the deaths of 4 American pilots during the 1961 invasion of the Bay of Pigs.

So, is this the way it works? If a country, even though communist, helps big business profit through cheap labor, outsourcing, and oil, it’s declared a "good communist". And, if not, you are a "bad communist?” I think I get it.

Going a step further, if you are not communist, have oil, and don't allow our big oil companies to go into your country and take over, you are bad too.

Since our politicians and Wall Street love the "good communist", why don’t they get into the same business as their pals? As I have already shown above, re-directing the money already spent in Iraq would have been a very wise and profitable venture.

Heck, maybe one day our politicians will figure out that they could make more money from a government owned Oil Company than from the contributions they receive from the big oil companies.

Disclaimer—This is for informational purposes only and is in no way a solicitation or an offer to sell securities. I am a registered investment advisor, but only provide solicited advice to clients of our firm in states where we are registered or where an exemption or exclusion from such registration exists. nothing on this website should be interpreted to state or imply that past results are any indication of future performance. carefully assess your own risk tolerance and goals before investing.