The state of the American State present a gloomy picture. The country is deeply in debt because Uncle Sam spends more money than it takes in. The numbers don’t lie and are easy to understand:
• The United States gets on average $2.2 trillion dollars in revenue via taxes and sundry, per year.
• The United States spends on average per year $3.7 trillion dollars.
• This adds $1.5 trillion dollars to the National Debt ($16 trillion and climbing) on a yearly basis.
It is a financial situation that has to be remedied or everything that We the People have worked for over the past two hundred years will go up in flames…aka bankruptcy. We have two major political parties in this country… aka the political establishment who are responsible for this dilemma, who refuse to face the fact that the country credit’s card is about maxed out and spending HAS TO BE brought under control …aka A BALANED BUGDET!!!
So much for lesson number one of Econ 1.0
The problem we have as a nation centers around that swamp hole in Washington D.C. where politics preempts all common sense and it prevents the political establishment from doing what is necessary to right the ship of State.
A new study from the Institute for Energy Research just released show that the United States has assets worth $128 trillion, about 8 times our national debt. This is an accumulation from Federal Land (600 million acres) on shore and off shore, the very energy resources that lie below our feet.
To give you an idea of what the energy industry can do to help start straightening out our fiscal mess … this from The American Petroleum Institute (API) blog:
API’s State of American Energy event marked the release of our new energy policy report – which will be forwarded to the new Congress and the administration. Energy policy – on new access to resources, developing them and key issues such as whether to allow the export liquefied natural gas – likely will have a high profile when official Washington resumes work later this month. Highlights:
The oil and natural gas industry has been a bright spot in an otherwise sluggish economy, but is poised to do more:
• Jobs – Industry supports 9.2 million jobs and could support another 1.4 million jobs by 2030 through investments in more domestic development and refining.
• Economic stimulus – Industry supplied $545 billion in stimulus in 2011 in the form of capital investments, wages and dividends and can do more with greater access to domestic oil and natural gas reserves, onshore and offshore.
• Revenues for government – Industry spends nearly $86 million a day to the federal government in income taxes, royalties and other fees. With increased energy development it could furnish $800 billion in new revenues for government by 2030.
The U.S. Energy Information Administration’s Short-Term Energy Outlook released this week contains two important crude oil stats:
• U.S. domestic production is expected to continue growing rapidly over the next two years, from an average of 6.4 million barrels per day (bbl/d) last year to 7.3 million bbl/d in 2013 and 7.9 million bbl/d in 2014. Much of the production growth will come from drilling in tight plays in the Williston (North Dakota and Montana), Western Gulf and Permian basins (Texas).
• U.S. liquid fuel imports, including crude oil, are expected to decline to an average of 6 million bbl/d by 2014. EIA says the net import share will average 32 percent in 2014 “because of continued substantial increases in domestic crude oil production.”
Here’s one of the main things wrong with arguments some are making against the export of U.S. liquefied natural gas (LNG): They substitute narrow interests and agendas for the proved economic benefits of free trade to the entire United States – long demonstrated in the sale of countless other U.S. commodities to overseas buyers.
Fundamentally, the free trade of U.S. products overseas means cash flowing into this country instead of out. Meanwhile, securing customers in foreign markets helps American producers expand their businesses, create jobs and add value to our economy.
My final comment: I have only touched upon a few items relating to energy but as you can see the energy industry can lead the way out of our fiscal problems with dollars for the Federal coffers and millions of jobs that will add more revenue in the way of tax dollars.
Now it is up to Washington to exercise some ‘common sense’ and do the right thing.