Posted tagged ‘Bakken Oil Fields’

Free Market Fracking Trumps Government Solutions When It Comes To Producing Energy

June 23, 2015

Mark J. Perry at CarpeDiemBlog visited the Bakken oil fields in North Dakota and has written about what he learned in these two must read posts titled, Ten Things I Learned On My Summer Trip To The Bakken Oil Fields Part I click here, and Part II click here. These articles tell the story about every aspect of fracking. You will be amazed when you read how fracking works, from walkable drilling platforms, directional drilling, frac sand, 3-D seismic imaging, and geo-steering to name a few.

Even though Saudi Arabia is trying to drive the price of oil down in an attempt to make it unprofitable for American Fracking to produce oil at the lower price, hydraulic fracturing is becoming an increasingly more cost-effective way of extracting oil from the ground due to the advances in technology and human ingenuity. What’s left of Americas culture of freedom has produced a fracking miracle. There are so many known and yet to be known areas of our economy that are poised for a miracle if Government will just get out of the way.

ANIMATION OF HYDRAULIC FRACTURING

 

GOVERNMENT IS AGAINST LOW COST ENERGY

The Federal Government has spent billions of our tax dollars trying to make “green energy” a viable alternative to fossil fuels, at the same time they are trying to hamper the fracking revolution. Here is what I wrote in a previous post titled Politicians “Affordable” Ideas Must Obey Economic Forces.

“Market forces are more powerful than the hoped for results of central planners. The most recent example of this is the boom in oil and natural gas production, created by hydraulic fracturing [ fracking],which is taking place on private land in spite of Government policies. Our politicians shut down some Government lands to oil exploration, and made the process of getting permits for exploration on remaining lands more time-consuming [costlier]. They used their power, and our tax dollars, to promote and invest in, “green energy”. Green energy was going to create new jobs and lead our economy into the future; do you remember Van Jones the Green Jobs Tzar. As always, the plans by our best and brightest politicians, must be obedient to economic forces. Green energy has, and is, going bankrupt, in spite of being propped up by Government incentives  and our tax dollars. They tried to make carbon based fuels more expensive through regulation, and green energy more affordable through tax payer subsidies; and even with all this Government help, the economic reality that green energy produces less energy at a higher cost, and carbon based fuel produces more energy at a lower cost, can’t be overcome.”

“This article titled, “Fracking Revolutionized American Energy As Green Energy Failed“, by Conn Carroll at washingtonexaminer.com, shows how the President went all in on green energy, at tax payers expense. We are witnessing what Robert Bradley Jr., at masterresource.org, has stated so well, “When Government tries to pick winners and losers, it typically picks losers. Why? Because in a free market consumers pick winners to leave the losers for Government”

Related ArticleGovernment Investment Or Government Waste, at austrianaddict.com. Look at the list of failed government subsidized  green energy companies in this post.

Related ArticleThe Hidden High Cost Of Green Energy, at austrianaddict.com.

 

Must Reads For The Week 6/14/14

June 14, 2014
The pen is mightier than the sword...

 The pen is mightier than the sword… (Photo credit: mbshane)

 

Rehypothecation Evaporation Concerns Grow, As Copper Plunges Most In Three Months, at zerohedge.com. Rehypothecation is simply selling claims on a commodity, a good, a product, etc, above the amount that exists. If the owner of the Mona Lisa wants to store the painting in your art warehouse, you give him a receipt for the painting. This receipt is a claim on a particular painting by the owner, to be redeemed at any time. What if you make a counterfeit receipt and sell it. There are now two claims on the Mona Lisa. If you own a grain elevator, farmers will store their corn, measured in bushels, in your bins, and you give them a receipt for X amount of bushels to be redeemed at any time. You don’t have to give the farmer back the exact bushels of corn he brought in because bushels of corn are homogenous, unlike the Mona Lisa. What if you started selling counterfeit receipts for the corn? What if you have twice as many claims on bushels of corn as you have bushels of corn in your grain bins?  Your theft will remain hidden until such time that you don’t have enough corn to cover a receipt that is presented. The rehypothecation of copper, and the examples of the Mona Lisa and the bushels of corn, are examples of  how our Fractional Reserve Banking System works. Banks can loan out 10 times the amount of money they hold in reserve. If they have $1million in reserve, they can loan out $10 million. Money never exchanges hands, it is transferred electronically when a check {warehouse receipt} is presented. Its a sweet deal for the banks because they get to collect interest on the electronically printed counterfeit money {warehouse receipts}. Unfortunately this counterfeit money has been released in the market and is causing the unintended consequences of misallocating scarce resources and inflation. Read  more about this topic in my article here.

Texas Mom Outraged Because Her Daughters School Won’t Allow Sunscreen, by Rebecca Klein, at huffingtonpost.com. I love it when the rules central planners make come into conflict with each other. In this case officials at the district banned sunscreen because it is a toxic substance. But what about the central planners who have regulated tanning bed use by minors because of the possible danger of skin cancer. Central planners are all or nothing rule makers. They don’t understand that life consists of tradeoffs. But more importantly they don’t understand that decisions concerning these kinds of trade offs should be made by each individual or in this case the parent.  In this case the individual has to trade off one danger, the risk of the toxicity of the sunscreen against the risk of getting skin cancer. As I have learned from reading Thomas Sowell, their are no categorical solutions, just incremental trade offs. Central planners don’t understand that the more incremental decisions they take away from individuals, and make them categorical decisions for everybody, {except for themselves} the more strife they create between us and them.

LET’S LOOK AT MINIMUM WAGE REALITY

1) A Report From The Bakken Oil Fields, Where The Jobless Rate Is 0.9% And WalMart Is Paying 2.4 Times The Minimum Wage, by Mark J. Perry, at aei-ideas.org. The Federal minimum wage rate is $7:25, as is North Dakotas minimum wage rate. Will the central planners, at the federal and state levels, mandate that the wages of these workers at the bottom of the wage scale be dropped to $7:25 an hour just to be “fair” to the other minimum wage workers in other states?  Or should the central planners pass a law that mandates a maximum level of the minimum wage? These planners apparently have more knowledge about what wages should be than the knowledge the market can bring to bear on wage rates. The market in North Dakota is obviously wrong for paying these low skilled workers over double what the mandated minimum wage is. Don’t these central planners exist to correct the inequalities produced in the market?

2) Seattle Business Charges “Living Wage” Tax In Response To $15 Minimum Wage Hike, by Jessica Chasmar, at washingtimes.com. Plans by central planners can’t work like the planners planned. Why? Because there is still enough of a free market remaining that businesses have options other than just paying the new minimum wage rate. They can raise prices like this company, they can replace labor with technology. they can replace low skilled low wage labor with more productive higher skilled higher wage labor, or they can look to cut costs elsewhere in the production process. If raising the minimum wage for low skilled labor would increase production and profit, businesses would already be paying a higher wage, just like what is happening in North Dakota because of the oil boom.

NOW LETS HAVE SOME LAUGHS

12 Things Men Do Differently Than Women, at economicpolicyjournal.com.

Pee Wee Obama, at theburningplatform.com. I’ve been trying hard not to do this, but I can’t help myself.

Compare this video of President Working Out In Polish Gym, to this, Olivia Newton John, Physical video.

I saw these cartoons at theburningplatform.com.

WHEN THESE POWER PLANTS CLOSE, WHERE WILL THE ELECTRICITY COME FROM?

149321 600 Rates Skyrocket cartoons

 COAL POWERED CARS, I PADS, AND I PHONES

149426 600 Coal Industry cartoons

SOCIALIZED MEDICINE BY ANY OTHER  NAME…..

149459 600 Making Obamacare Look Good cartoons