Schumer Said So

There’s a lot of wingisms and memes I don’t really get, but I think one of the most egregious is that, even if you’re stone cold wrong, as soon as one of the “other guys” says the same thing, you’re suddenly right, and not only that, but you’re right because someone you say is wrong about 99.9% of everything said so. It’s like the height of cognitive dissonance, but it’s a good filter through which to view the “Hill staffer” K-Lo reprints here:

For all of you writing (or reading about) how much ANWR, OCS and other increased domestic production would affect the price of gas, please note what Sen. Schumer just said on the floor about the impact of increased production in Saudi Arabia.

“If they produced half a million barrels more oil a day the price would come down a very significant amount and, at the same time, it would stop the speculation that keeps driving up the price of oil.”

Keep in mind, ANWR alone is projected to produce one million barrels a day, every day. In fact, if President Clinton had not vetoed legislation opening up a small portion of ANWR thirteen years ago (1995), a million barrels a day would be flowing from ANWR right now, helping to keep prices down at the pump.

Which is well and good, but there’s a few ways you could go with this one. For starters, K-Lo could recognize that just because “the other guy” repeated one of your deeply held but deeply wrong belief doesn’t make you right, it makes him wrong (and in so much as I generally regard him as one of the most disappointing Senators, I don’t really have a problem saying that Chuck Schumer is wrong). Or K-Lo could take a second to, I don’t know, think about what’s being said and juxtapose that to various matters of fact, and draw out logical conclusions. To wit, an extra 500,000 barrels a day won’t have much of an impact on global oil prices, because it would be gobbled up in no time. As a good reference point, global demand rises by 1%, or about 800,000 barrels a day, annually. Or, in other words, at 160% the rate of increase in supply we’re talking about. Take that out over a mer 2-5 years, and the extra supply is nothing in comparison. It also won’t help speculation, in so much as speculation occurs when traders are generally confident prices will increase overtime, and so they want to buy commodities now. Does anyone think that an extra 500,000 barrels a day will lead to drastically reduced oil prices? If not, you have no reason to believe speculation would abate. Of course, that would require K-Lo to know what speculation is.

Then again, K-Lo might have just fact-checked her friendly neighborhood “Hill staffer.” The claim that ANWR would account for 1 million barrels a day is absurdly false, and might have given a rational person (so K-Lo gets a pass I suppose) second thoughts about this “Hill staffer’s” understanding of the issue they’re opining about. Most credible peak estimates for ANWR run at about 725,000 barrels a day (or still less than annual increases in demand), and more or less everyone agrees that the price impact would be laughably minimal in the long run. From the Wall Street Journal:

Last month the Department of Energy produced a report titled, “Analysis of Crude Oil Production in the Arctic National Wildlife Refuge.” (Hat tip, Menzie Chinn) The report makes two points that indicate that drilling in ANWR won’t do much to decrease energy prices any time soon. First, the report states that drilling wouldn’t add to domestic production for at least 10 years, and peak production can’t be expected until the 2020s. Meanwhile, under the middle-of-the-road estimate for output oil prices would be expected to decline by only 75 cents per barrel in 2025. If there’s less oil than expected in ANWR the reduction in prices would be 41 cents per barrel in 2026, and if there’s more than expected the drop in prices is seen around $1.44 per barrel in 2027. That would translate into a reduction in gas prices between just one cent and four cents, according to an analysis prepared by Congress’s Joint Economic Committee.At current prices even the high-end estimate would trim just about 1% from the cost of a barrel of oil, and even that reduction can’t be expected for almost 20 years.

Keep in mind, that’s $1.44 per barrel of oil, not per gallon of gasoline. And that’s in 2027, after 19 more years of oil price increases. So if we open up ANWR now, by 2027 oil could be $198.56, instead of $200 a barrel. Hypothetically. But Chuck Schumer says otherwise, and since K-Lo always agrees with every single thing Chuck Schumer says, that makes it right.