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By Robert Rapier on Apr 21, 2011 with 24 responses

I Can’t Take Donald Trump Seriously

I am constantly amused by the views of presidential candidates on energy policy. Their views are either so disingenuous or so naive that I often find it difficult to vote for a candidate.

In the 2008 election, I could have voted for Barack Obama, who declared war on fossil fuels, painted the oil companies as enemies of the people, and proposed pandering gimmicks like the “use it or lose it” proposal. It has been interesting to watch President Obama vacillate between punishing oil companies with windfall profit taxes, and encouraging greater production by offering them more tax incentives. It is as if President Obama now recognizes that domestic production of oil and gas would need to be a very big part of any realistic energy independence plan.

Or I could have voted for John McCain, who flip-flopped on his ethanol views, proposed gimmicks like a gas tax holiday, and picked as his running mate someone whose energy policies resembled those of Hugo Chavez.

But Donald Trump is in a category all by himself. Last month we heard Trump being “pragmatic” by suggesting that we simply go in and take control of Iraq’s oil. His rationale was that the U.S. spent $1.5 trillion on the war there, and we should take their oil to pay ourselves back. He reiterated this in an interview with George Stephanopoulos:

Trump: George, let me explain something to you. We go into Iraq. We have spent thus far, $1.5 trillion. We could have rebuilt half of the United States. $1.5 trillion. And we’re going to then leave. So, in the old days, you know when you had a war, to the victor belong the spoils. You go in. You win the war and you take it.

Stephanopoulos: It would take hundreds of thousands of troops to secure the oil fields.

Trump: Excuse me. No, it wouldn’t at all.

Stephanopoulos: So, we steal an oil field?

Trump: Excuse me. You’re not stealing. Excuse me. You’re not stealing anything. You’re taking– we’re reimbursing ourselves– at least, at a minimum, and I say more. We’re taking back $1.5 trillion to reimburse ourselves.

As far as the price of oil goes, he has a simple solution to that too. He will just tell OPEC to lower prices:

Asked by CNN host Candy Crowley what his idea would be to get OPEC to lower crude oil prices, Trump said: “It’s the messenger.”

“I can send two executives into a room. They can say the same things; one guy comes home with the bacon and the other guy doesn’t,” Trump said. “I’ve seen it a thousand times. … We don’t have the right messenger. [President Barack] Obama is not the right messenger. We are not a respected nation anymore and the world is laughing at us.”

So it’s as simple as that. You know, there is naivety about energy issues, and then there is just plain ignorance. While I agree that speculation is helping to drive up prices, there are fundamental supply and demand issues involved here. OPEC is no more going to lower oil prices than American farmers are going to lower corn prices, or Donald Trump is going to lower real estate prices. Prices are not so disconnected from the laws of supply and demand that OPEC can just lower prices without consequence. What would happen is the same thing that would happen if corn prices were cut back to historical levels: Demand would increase and shortages would ensue.

Further, Trump’s attitude seems to be that the U.S. has some kind of entitlement to that oil. How offended would Trump be if the Chinese government demanded that he sell them a piece of his New York real estate at below market prices? After all, New York real estate is very pricey. Some might say that like oil, the value of New York real estate has been pushed up by speculators, and this therefore hurts everyone who wishes to buy real estate there. But I suspect if the Chinese demanded that he sell to them at below market prices, Trump would think they were insane.

Turns out though that Trump does have a fan in author and Huffington Post blogger Raymond Learsy. Of course that’s because Learsy is upset about the same thing: That Saudi Arabia is hogging all of our oil. Maybe if Trump gets into the White House, he can tap Learsy for Secretary of Energy. Then, instead of working to reduce our own demand and increasing domestic supplies, they can march our sons and daughters off to wars for the next two decades so we can seize the resources of sovereign nations.

  1. By Duracomm on April 21, 2011 at 9:00 am

    Excellent post illustrating the hazards of having ignorant, egotistical politicians mucking about in the energy markets.

    Politician’s ignorance and political pandering make them a far greater threat to our energy security than OPEC ever has been.

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  2. By Wendell Mercantile on April 21, 2011 at 1:30 pm

    No rational, well-informed, reasonable person would vote for Donald Trump as president.

    That means he’s probably got a shot.

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  3. By OD on April 21, 2011 at 1:57 pm

    Robert, just caught you on the Doug Wright show! What a pleasant surprise that was, and I agree completely with everything you said. I don’t believe it is a coincidence that the dollar hit its all time low just a couple months before oil hit the all time high. It appears we are going to test that low again or even surpass it. Will the USD rebound this go around? Normally I would say yes, but the strength of the Euro, given the collapsing PIIGS, is very puzzling and makes me think there has been a fundamental shift.

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  4. By rrapier on April 21, 2011 at 2:10 pm

    OD said:

    Robert, just caught you on the Doug Wright show! What a pleasant surprise that was, and I agree completely with everything you said. I don’t believe it is a coincidence that the dollar hit its all time low just a couple months before oil hit the all time high. It appears we are going to test that low again or even surpass it. Will the USD rebound this go around? Normally I would say yes, but the strength of the Euro, given the collapsing PIIGS, is very puzzling and makes me think there has been a fundamental shift.


     

    Thanks, OD. Where are you located? I am not sure about the reach of that show; whether it is only locally in Utah. I wish he had asked me what people could do to combat high prices. The nature of his questions were quite a bit different than the last radio interview I did. I don’t really like to get into short-term predictions, because those price swings sometimes get pretty disconnected from supply and demand.

    RR

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  5. By OD on April 21, 2011 at 2:31 pm

    I am in Utah, but I believe you can listen to the show in parts of Idaho & Wyoming.  I have listened to him on and off for a few years and I am left with the impression that he believes we can solve our energy problems by more drilling, technology, etc, so that could be why he was only interested in the short-term.

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  6. By Benny BND Cole on April 21, 2011 at 2:37 pm

    Well, at least Donald Trump thinks like a businessman. He raises an extremely valid point: We have unloaded $1.5 trillion on Iraq, and gotten nothing back (and another $1.5 trillion on Afghanistan).

    No, I am not suggesting we compound the error by becoming monsters and thieves, and seizing oil fields.

    But it is refreshing to hear someone compare the costs of our foreign policy to benefits.

    And Trump is right: How many nuke plants could we have built, how many PHEVs, how many CNGs could we have put on the road for $1.5 trillion? In the 10 years we have been in Afghanie, how far could we have gone to real security for $3 trillion?

    And we still don’t have the slightest energy security, as is being demonstrated daily by Libya, Saudi Arabia, Venezuela, Mexico, Iran etc etc etc.

    All those aircraft carriers, and airplanes, and troops are a huge waste of money. You can’t pump oil out of the ground with an M-16 rifle, and you can’t use an aircraft carrier as an oil tanker.

    No, I am not sure about Trump. But, jeez, it would be nice to have someone who had some of his business reasoning skills.

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  7. By rrapier on April 21, 2011 at 4:26 pm

    Benny BND Cole said:

    And Trump is right: How many nuke plants could we have built, how many PHEVs, how many CNGs could we have put on the road for $1.5 trillion? In the 10 years we have been in Afghanie, how far could we have gone to real security for $3 trillion?


     

    That’s a totally separate observation. I have commented on this before; that we could have put solar panels on half the homes in the U.S. for the price of the war in Iraq. And that in fact, it did not help our energy security. But Trump’s ideas are nuts. OPEC isn’t going to just lower prices — no matter who the messenger is. And we can’t just go in and take the oil from other countries.

    RR

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  8. By Optimist on April 21, 2011 at 5:48 pm

    “Tell OPEC to lower prices!” LOL!

    What happens if OPEC tells Pres. Trump to go pound sand? Who’s getting fired?

    Run, Trump, run! I need the comedy.

    Can’t wait to hear this guy debate energy solutions with Sarah Palin…

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  9. By Benny BND Cole on April 21, 2011 at 7:11 pm

    RR-
    Well, true, true, on the other hand, would Trump have done any worse than Bush or Obama on energy policy?

    No, I won’t vote for Trump. But it is aggravating not to hear any of the candidates speak with clarity regarding oil supplies, consumption and bona fide national security.

    At least Trump got half of the equation right: $3 trillion has purchased us no oil, and no security (arguably the reverse). The GOP has not had yet this moment of truth. (And no, Obama is not much better).

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  10. By James on April 21, 2011 at 9:33 pm

    He also gave a large sum of money to the D.N.C. to get Obama elected.
    Skunks don’t change their stripe!
    He intends to split the G.O.P. to re elect his good buddy Obama.

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  11. By OD on April 21, 2011 at 10:34 pm

    But Trump’s ideas are nuts

    Most of them definitely are, but I do agree with him about a 25% tariff on imported Chinese goods.

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  12. By jerry-unruh on April 21, 2011 at 11:00 pm

    It seems like neither Donald nor Benny has any problems with wars of aggression.  Those were wars of choice.  Why should we be rewarded?

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  13. By tennie davis on April 22, 2011 at 1:13 am

    I have a sneaking suspicion James is correct!
    Remember Perot? A vote for him was a vote for Clinton.
    @ OD, 25% tariff.
    Than what? tradewar?
    Than your china trinkets will cost more.
    They also might not pay us as much for raw materials (like scrap) that we sell them.
    Lots of unintended consequences, that’s just one I could think of.
    Free trade & old fasioned competition appeals to me.

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  14. By GDkeys on April 22, 2011 at 10:26 am

    Robert: Congratulations on getting in the Washington Post. You deserve it. Interesting revelations in this post. I didn’t know Trump was that out there. His views make Gingrich look well-balanced in comparison. Who knows? Maybe that is his intent.

    Wendell Mercantile said:

    No rational, well-informed, reasonable person would vote for Donald Trump as president.

    That means he’s probably got a shot.

    Sadly you are right.

    Sensibility is shouted down by what amounts to polarized pandering that is sounding more and more like what little I’ve seen on The Jerry Springer Show, especially as each new campaign cycle unfolds.

    It would be good to see someone enter the field who gets it, that energy security is too serious to be an either/or, new development vs conservation issue, and who, just as importantly, fears neither side in tying these approaches together – like say opening ANWAR to drillers, if they want it in the face of dropping consumer demand and gas prices as the ripple effects of a contingent measure like dropping all speed limits nationwide transpire to include a flourishing and sustainable e-car industry enabled by less power requirements.

    Perhaps in such a scenario both sides will stop yelling at each other about energy independence so they can get on with arguing about matters of more or less consequence.

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  15. By Optimist on April 23, 2011 at 5:55 pm

    …like say opening ANWAR to drillers, if they want it in the face of dropping consumer demand and gas prices…

    Those two don’t go together. Dropping gas prices = higher demand, and vice versa. It won’t be changed by outside factors.

    …as the ripple effects of a contingent measure like dropping all speed limits nationwide…

    Speed limits are way too low already, thank you. There are US cities where people still drive 53 mph – just to make sure they don’t accidently exceed 55 mph. Time to move on. Life is moving faster, not slower. Oil prices is not the be all and end all of modern civilization!

    …transpire to include a flourishing and sustainable e-car industry enabled by less power requirements.

    Sorry, to burst your bubble but the e-car is not here (yet). Google sales figures for the Volt and Leaf and weep. Not that a coal powered vehicle gets me all hot and fuzzy…

    Perhaps in such a scenario both sides will stop yelling at each other about energy independence so they can get on with arguing about matters of more or less consequence.

    Keep dreaming. The vested interests are doing to well with the status quo to let it go.

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  16. By mac on April 23, 2011 at 9:53 pm

    “Google (the) sales figures for the Volt and Leaf and weep.”

    Nissan has manufactured and sold over six thousand Leaf vehicles, mainly to priority customers in Japan. Not bad considering the fact that Toyota only sold just 18,000 Prius hybrids in all of 1998.

    A recent aerial photo taken at the Port of Long Beach shows what looks like several hundred Leaf vehicles (from the second Leaf container ship to hit U.S. shores).

    Nissan’s original production run was capped at 20,000 vehicles. At that point they capped pre-orders.

    Now, Nissan has re-opened pre-orders beginning May 1, 2011.

    Very interesting…………….. We’ll just have to wait and see what happens, I guess.

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  17. By armchair261 on April 24, 2011 at 4:36 pm

    Most of them definitely are, but I do agree with him about a 25% tariff on imported Chinese goods.

    Start a trade war with a country holding $1.2 trillion in US Treasuries? Can’t be a good idea….

    I was reading an article in the AAA magazine Westways on the Leaf, and as I went through the reasons for buying, I was thinking, this might be the year to go electric.

    Then I got to the caveats. An estimated 20 hour charge time on 120 volts (can be reduced by half if you pay $2000 to $4000 for a Level II charger). According to Southern California Edison, a “second electrical panel and meter” may be needed for another few thousand. A 73 mile range in optimal conditions (hopefully I wouldn’t get stuck in LA traffic on a sweltering day, my A/C turned off to prolong the battery life). An overall price tag, net of additional investment (above) and subsidies, of around $30K.

    Still, with continued progress, my first electric car could be only a few years away now. I think the Leaf sales are low because I suspect its market is largely limited to an upper income market with a conscience. It would only take some not too radical improvements in range and cost for its market to take off.

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  18. By mac on April 24, 2011 at 11:11 pm

    Both Nissan and GM announced from the outset that they were going to roll out their electric cars slowly,

    Nissan is initially offering the Leaf in only seven states, Arizona, Washington, Oregon, California, Texas, Tennessee and Hawaii. In the fall of 2011 Nissan plans to add Alabama, Florida, Georgia, North Carolina, Maryland, South Carolina, and Virginia. Nationwide ordering begins in 2012. So, it will be 2012 before the Leaf is even available in all 50 states.

    Similarly, GM was originally going to offer the Volt in only 5 target states but changed its mind and will offer the car nationwide supposedly due to interest in the vehicle. (And perhaps because they won several motor magazine “Best Car” awards.) I’ve heard that some of the early Volt production is now being diverted to provide each Chevy dealership with at least one demonstration model. For the love of Pete, the Leaf isn’t even being sold on the East Coast yet (a huge market) and GM is scrambling to get demo models into the hands of their dealers.

    The bottom line is that the Volt and Leaf aren’t even truly being sold on a nation-wide basis yet. Of course, all the EV critics are already very busy, running around pronouncing the last rites.

    Frankly, I think PHEVs and vehicles running on CNG stand a better chance of eliminating our imported oil dependence than do pure electrics. CNG for heavy equipment and big trucks. PHEVs for light duty trucks and cars. The Port of Long Beach, however, is using electric “mules” to haul around ship cargo containers, This works out well because on sight air pollution is virtually eliminated and the mules van be recharged in shifts or at nite and only have to travel limited routes within the Port complex.

    Perhaps we are getting too worked up about all this…

    After all, once Trump takes office we’ll just march into the Saudi oil fields and take them over. Then we won’t have to fret and worry about electric cars or high gas prices any ,more.

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  19. By Optimist on April 25, 2011 at 5:13 pm

    GM is still targeting selling 10,000 Volts for 2011. To hit that they would need to average ~1,000/month for the rest of the year. Their best month so far was March with 608. Could still go anywhere, I guess. But if I was a betting man I would rather bet against than for…

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  20. By russ on April 26, 2011 at 1:47 am

    Donald will probably last until things start to heat up for the general electorate and writers are really paying attention. He will say some really dumb things that make the front page and flame out.

    It is entertaining to have the fool around until show time starts.

     

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  21. By BilB on April 27, 2011 at 5:30 am

    I have to agree completely.

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  22. By Wendell Mercantile on April 27, 2011 at 9:32 am

    It is entertaining to have the fool around until show time starts.

    He is entertaining, but I often wonder why he can’t find a good barber. How could anyone with a comb-over that cartoonish expect to be taken seriously?

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  23. By Walt on April 30, 2011 at 1:15 pm

    Who will bring integrity to the white house in the next election?  The more I see evidence the more I am concerned with our elected officials.

     

    http://www.youtube.com/watch?v…..r_embedded

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  24. By Herm on May 4, 2011 at 4:53 am

    He may try to do a Perot to the republicans, he did donate lots of money to Obama in the last cycle.

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