Congress Threatens Oil Producers

Before we discuss Congressional threats on oil producers, let's first consider the Florida legislature's move to ban fake testicles on vehicles.

Senate lawmakers in Florida have voted to ban the fake bull testicles that dangle from the trailer hitches of many trucks and cars throughout the state.

Republican Sen. Cary Baker, a gun shop owner from Eustis, Florida, called the adornments offensive and proposed the ban. Motorists would be fined $60 for displaying the novelty items, which are known by brand names like "Truck Nutz" and resemble the south end of a bull moving north.

Some might think that legislators have better things to do than debate "Truck Nutz". Not me. I would like to see state and national legislators spend more time debating "Truck Nutz", flag burning, baseball steroids, the nation anthem, and motherhood and apple pie on the general principle the more time they spend debating frivolous topics of no economic importance, the less likelihood they will do real damage somewhere else.

For example, please consider U.S. arms sales to OPEC at risk over oil.

Democrats in the U.S. Senate stepped up their attacks on OPEC oil producers on Thursday, threatening to block billions of dollars in arms sales to suppliers such as Saudi Arabia if they fail to take action to tame record oil prices.

Democratic senators Charles Schumer of New York, Byron Dorgan of North Dakota and others called on the White House to "jawbone" OPEC members to boost output or risk Congress blocking arms deals with Saudi Arabia, the United Arab Emirates and other OPEC members.

"The Saudis have to understand this is a two-way street," Schumer told reporters. "We provide them weapons, our troops provide them protection, and then they rake us over the coals when it comes to oil."

Last year, Democrats in the U.S. Congress pushed through a bill that would allow the federal government to sue OPEC for price manipulation. The White House has said it would veto the so-called NOPEC bill, and opponents have warned that OPEC members could retaliate by turning off the taps.

Leave it to Congress to threaten a major oil producer when prices are at record levels, brag about out troops on their soil when most of Saudi Arabia does not want them there, and threaten to stop sales of weapons when our balance of trade is in shambles.

A more rational viewpoint came from Frank Verrastro, an energy expert at the Center for Strategic and International Studies who said, "Tying oil prices to arms sales could motivate Middle East producers to seek cozier arms-for-oil agreements with countries such as Russia and China."

This is so basic a child could figure it out, but apparently it is far too complex for the minds of Senators Charles Schumer of New York and Byron Dorgan of North Dakota. And so... what this country desperately needs is another baseball steroids scandal or other similar episode of no economic importance, or anything else to distract these "Numb Nutz" from saber rattling in the Mid-East.

Congress typically does the most damage when it tries to get something done. This case is no exception.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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