Tuesday, July 31, 2007

Increasing Supply, Increasing Demand

There's no gouging at the pumps, the economists tell us; it's good old supply and demand. More cars, more fuel needed, not enough petrol to go around and look there on the graph where high demand meets low supply. Right where the high prices intersect.

Over in Whiting, Indiana, British Petroleum is going to expand their refinery. They hear the cry of the consumer, pleading for more liquid gold to power the family fleet of automobiles, and they are coming to the rescue. Create more pollution. The state of Indiana is all for it, with the promise of thousands of temporary jobs during the construction process, followed by up to eighty new positions to run the expanded refinery. In a few years, there will be more gasoline in the pipeline, and more supply equates to lower prices. More ammonia and sludge into Lake Michigan.

With jobs on the line, Indiana granted BP a variance from current environmental laws so that the Whiting facility could be modified to handle heavy crude oil from Canada. Canada's that friendly nation just to the north, the non-Muslim extremist place that is pumping crude oil to drive the world's economy. However, Canada's oil is of a slightly different composition and it takes different equipment to refine. No one can argue that more refinery capacity is sorely needed. Biggest polluter gets bigger. BP is fully prepared to meet that need.

Meanwhile, on the other shores of the Great Lake, local officials are up in arms about the new refinery. The nation, indeed, the world is desperate for more fuel, yet these politicians would try to stop a critical project that would lower gasoline prices. What wise office-holder wouldn't want to get behind something like that? More ammonia which promotes fish-killing algae, more heavy metals, more poisonous mercury.

In the face of the controversy, BP has reminded the anti-price-lowering whingers that they will be upgrading their wastewater treatment facilities, all in an effort to protect Lake Michigan from the shite that they dump into the source of fresh water for a sizable portion of the population. The U.S. Environmental Protection Agency has chimed in, to assure the public that the added pollution will not damage the lake, nor will it poison fish or people.

Senator Mark Kirk of Illinois has taken a dangerous tack, considering the fact that he is facing a challenger in the upcoming election. He has proposed the elimination of Federal tax breaks to companies that increase discharges into the lake, thereby blocking a much needed increase in refinery capacity due to the economic burden that would be imposed on a firm like BP. How will he face the voters, who are clamoring for lower gasoline prices? Unless, of course, the electorate has been reading the fine print.

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