Posts Tagged ‘ Gulf States ’

27,000 Abandoned Oils Wells In Gulf Of Mexico

Potential environmental time bombs in the form of 27,000 abandoned oil and gas wells are lurking in the hard rock beneath the Gulf of Mexico. Obama “Ass To Kick” Transcript. Over half of the 50,000 wells which have been drilled in the federal waters of the Gulf of Mexico have been abandoned, with 23,500 of them considered permanently sealed.

As many as 3,500 of the wells are considered “temporarily abandoned.” The oldest of the abandoned wells investigated by the AP date back to the 1940s. Wells are abandoned by oil companies when they are considered to no longer be profitable, or when the potential for the amount of oil to be drawn from the well is not as high as the company may have initially believed.

The standard procedure for plugging a well to be abandoned permanently by an oil company involves cutting riser piping 15 feet beneath the seabed, filling the well with heavy liquid, often referred to as drilling mud, to prevent the flow of oil and capping the well with cement plugs which can be up to 200 feet in length. Several factors can cause abandoned wells to leak or fail, including erosion or aging in the cement used to plug the wells and repressurization of wells due to changes in geological conditions. Erosion in well casing or other areas of the well structure can allow oil and gas to escape to the surface. This can occur gradually or in a sudden catastrophic blowout.

Many oil companies get around this by classifying their wells as “temporarily abandoned,” so they can plug the wells in a less thorough and expensive process. companies can leave their wells in a kind of legal limbo for years. They can do so knowing they will face no repercussion from governmental regulating industries.

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Obama $77,051 Biggest Recipient Of BP Cash
Obama’s Oil Spill Spreads To Florida
New Orleans New Disaster, Obama’s Oil Spill

Obama Brush Aside Gulf Oil Spill, Leave It Up To BP
Underwater Footage: Gulf Of Mexico Oil Spill


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Obama “Ass To Kick” Transcript

TRANSCRIPT COURTESY OF FEDERAL NEWS SERVICE…

PART I OF AN NBC “TODAY” INTERVIEW WITH PRESIDENT BARACK OBAMA
SUBJECT: EFFORTS TO RESOLVE THE GULF OIL-SPILL CRISIS INTERVIEWER: MATT LAUER7:02 A.M. EDT, TUESDAY, JUNE 8, 2010
MR. LAUER: We begin on a Tuesday morning with the disaster in the Gulf, now in its 50th day, and our exclusive interview with President Obama. We sat down on Monday before his commencement speech at a high school in Kalamazoo, Michigan. And I began by asking the president if the oil spill in the Gulf has made this the toughest point in his presidency to date.

(Begin videotaped segment.)

PRESIDENT OBAMA: This is tough, no doubt about it, because, you know, when you watch television or you go down to the Gulf and you see birds covered in oil and you talk to fishermen who are on the verge of tears — big, tough guys, but, you know, their livelihoods are being smothered by this oil that’s coming into the estuaries and marshes — it gets you frustrated.

And so this is a difficult time for the country. But it has not reduced my confidence that our trajectory is right. We’ve just got to keep on moving. We’ve got to keep on pushing. It’s going to be tough, but we’re going to get through it.

MR. LAUER: Do you feel at this stage, 50 days or so into this, that your administration has been damaged by this oil spill?

PRESIDENT OBAMA: No. First of all, I’m not concerned about my politics right now. What I’m concerned about is what’s happening down in the Gulf. And I guarantee you, the folks in the Gulf have been damaged by this oil spill. And livelihoods are at stake.

This is the largest federal response to an environmental disaster in history. From day one, we understood that this was going to be a major disaster. We have put unprecedented resources to deal with it.

MR. LAUER: Then why do you think there’s so much frustration aimed not only at BP right now but at your administration? There are people who are starting to wonder out loud if the oil spill in the Gulf could be — could do to you what Katrina did to President Bush or even what the Iran hostage situation did to President Carter.

PRESIDENT OBAMA: You know, I have to tell you, some of this is just the nature of the 24-hour news cycle. You’ve got a camera showing oil spilling out in the Gulf, and people are understandably frustrated and they’re upset, and they have every right to be.

But here’s what I can say, that we have responded with unprecedented resources. And when you look at what most of the critics say, Matt, and you ask them, “Well, specifically what is it that the administration could or should have done differently that would have an impact on whether or not oil was hitting the shore?” you’re met with silence.

And the fact of the matter is there has not been an idea that is mentioned out there by any of the critics that we haven’t evaluated. And if it was going to work, we would have done it. But it happened under my watch that you still had these oil rigs out there that we thought could deal with this kind of situation and they haven’t been able to deal with it.

MR. LAUER: A day or so after that oil rig sank —

PRESIDENT OBAMA: Right.

MR. LAUER: — I spoke to Rear Admiral Mary Landry of the Coast Guard —

PRESIDENT OBAMA: Yeah.

MR. LAUER: — who was speaking on behalf of the administration. And I asked her —

PRESIDENT OBAMA: Right.

MR. LAUER: — I said, “We’re seeing an oil slick in the water. Where’s that coming from?” And she said, “There is no evidence that that’s coming from this wellhead. That’s residual oil coming from the rig itself.”

PRESIDENT OBAMA: Right.

MR. LAUER: A day later, she echoed those same comments.

PRESIDENT OBAMA: Right.

MR. LAUER: Was the administration misled, in your opinion? Were you relying too much on information from BP? And from the start, did BP try to downplay the situation?

PRESIDENT OBAMA: Well, here’s what I think happened. Initially the thinking was that, in fact, the rig had sunk but the blowout preventers had shut down the well, because that’s what they were supposed to do. So the anticipation was maybe a thousand barrels might be leaking a day, but this is not going to be a monumental spill.

As soon as people understood that the blowout preventers weren’t working, that the valves that were supposed to shut down in the event of a blowout like this had not functioned properly, then I think people understood right then that this was going to be a significant emergency.

In terms of our relationship with BP, our general attitude has been that they have an incentive to shut this thing down because it’s going to cost them money, and I’m going to stay on them, if it’s the last thing I do in this administration, to make sure they’re paying off those fishermen and —

MR. LAUER: Have you spoken directly to Tony Hayward, the CEO of BP?

PRESIDENT OBAMA: I have not spoken to him directly, and here’s the reason, because my experience is when you talk to a guy like a BP CEO, he’s going to say all the right things to me. I’m not interested in words. I’m interested in actions.

MR. LAUER: I —

PRESIDENT OBAMA: And we are communicating to him every single day exactly what we expect of him and what we expect of that administration.

MR. LAUER: In all due respect, that feels strange to me; that here we’ve got the CEO of a company that’s responsible for the worst environmental disaster in U.S. history, and I think — I’m just curious why you didn’t pick up — you wouldn’t pick up the phone and in some ways just give him a piece of your mind.

PRESIDENT OBAMA: Well, the — look, this has sort of been — this has been the main critique of the administration is giving a piece of my mind to these guys. Look, I would love to vent. I would love to just shout and holler, because I’m thinking about this day in and day out. But my main job is to solve the problem.

MR. LAUER: To solve the problem, you have to have a reliable partner. Let me read you some of the things that Mr. Hayward has said over the course of this disaster. He said, “The Gulf of Mexico is a big ocean. The amount of volume of oil and dispersant we’re putting into it is tiny in relation to the total water volume. The environmental impact of this disaster is likely to be very, very modest.” And then he said, “There’s no one who wants this to end more than I do. I’d like my life back.”

PRESIDENT OBAMA: Yeah. Well, the — I think the —

MR. LAUER: The family members of those 11 people who died on the rig and the people whose lives are going to be changed for years want their lives back too. He doesn’t work for you. But if he did, would you want him out?

PRESIDENT OBAMA: He wouldn’t be working for me after any of those statements. First of all, we’re going to have to find out why this thing went in the first place. And the fact of the matter is that there’s going to be a thorough review. And I don’t want to prejudge it, but the initial reports indicate that there may be situations in which not only human error was involved, but you also saw some corner cutting in terms of safety, and that BP is a multibillion-dollar corporation. It’s talking about paying $10.5 billion in dividends just for this quarter.

MR. LAUER: Right.

PRESIDENT OBAMA: We are going to have to make sure that not only do they shut down the cap, we are not only going to have to make sure that any deepwater drilling process that’s out there is, in fact, fail-safe and oil companies know what they’re doing, but we also have to make sure that every single person who’s been affected by this is properly compensated and made whole. When I went down there last Friday —

MR. LAUER: Can BP do that? Can they do all that?

PRESIDENT OBAMA: Absolutely. They can afford it. If I start seeing BP nickel and diming folks down there, then they are going to have to answer to us.

MR. LAUER: We’ve heard time and time again throughout this crisis, as BP has tried and failed with all their fixes, that this technology is untested at this depth.

PRESIDENT OBAMA: Yeah.

MR. LAUER: And it just raises a question. If this is where we’re drilling for oil, at 4,000 and 5,000 feet under the surface of the ocean, where’s the oversight in that? Why are they allowed to drill there if the worst-case-scenario methods to prevent disaster are untested at that depth? It doesn’t help to test them at 100 feet.

PRESIDENT OBAMA: When it comes to how we were operating in overseeing and taking the word of the oil industry generally, not just BP in terms of the fail-safe nature of what they could do, I think we have to completely review that. And that’s why I’ve assigned this bipartisan commission. I want them to report back to me, because you obviously cannot take the word of oil companies when they say they’ve got a bunch of redundancy and backup plans, when something like this happens and it turns out they have no idea what they’re doing.

MR. LAUER: So even as the oil is spewing into the Gulf, would you consider halting all drilling below a certain depth right now?

PRESIDENT OBAMA: Well, keep in mind what’s happening. First of all, there is — we’ve already instituted a moratorium —

MR. LAUER: On new drilling.

PRESIDENT OBAMA: — on new drilling. The production wells that are already pumping oil, those don’t seem to be the problem. The problem has to do with actually drilling and starting a new well. So we’ve put a moratorium on new wells. Shallow wells aren’t a problem because the risers essentially come up above the water. So if something like this happened in a shallow-water well, then folks would just get up on the platform and they would start fixing it and it would be shut down fairly quickly.

What we don’t have right now is an assurance that in these incredible depths, a mile down, and then they’re drilling another three miles down to get to oil —

MR. LAUER: Right.

PRESIDENT OBAMA: — that we can actually handle a crisis like this.

MR. LAUER: Have you allowed yourself to even imagine what the Gulf region will look like if oil continues to spew until August, what it will smell like, what the economic situation will be like down there?

PRESIDENT OBAMA: I have. And here’s what I’ll say. This is going to be a mess. It already is. But I’ve been down there, and the people are resilient, and these ecosystems are more resilient than I think we anticipate right now, if we act swiftly, if we act seriously.

There are going to be marshes, for example, where the oil goes in and the sea life that’s there is decimated for a season, maybe two. But potentially we can preserve those estuaries and those marshes so that three years from now things have come back; things have bounced back.

MR. LAUER: Critics are now talking about your style, which is the first time I’ve heard that in a long time. And they’re saying here’s a guy who likes to be known as cool and calm and collected, and this isn’t the time for cool, calm and collected —

PRESIDENT OBAMA: Right.

MR. LAUER: — that this is not the time to meet with experts and advisers. This is a time to spend more time in the Gulf and — I never thought I’d say this to a president — but kick some butt.

PRESIDENT OBAMA: (Chuckles.)

MR. LAUER: And I don’t mean it to be funny.

PRESIDENT OBAMA: No. And I understand. And here’s what — I’m going to push back hard on this, because I think that this is just an idea that got in folks’ heads and the media has run with it. I was down there a month ago, before most of these talking heads were even paying attention to the Gulf. A month ago I was meeting with fishermen down there standing in the rain talking about what a potential crisis this could be.

And I don’t sit around just talking to experts because this is a college seminar. We talk to these folks because they potentially have the best answers so I know whose ass to kick, right?

So, you know, this is not theater. Most of the decisions that I make on a day-to-day basis, I make because I have gathered the best information possible in very difficult situations, and my job is to figure out how can I move the federal government, the private sector, all the various players who are involved, to perform some very, very difficult tasks?

And I don’t always have time to perform for the benefit of the cable shows. What I do have is dedication and commitment to make sure that the people who are actually being affected by this are going to get the best possible service from me. And as long as I’m president, that’s the approach that I’m going to take to this job.

END.

Speaking of ASS!

Is this the language the President of the UNITED STATES should use?
Will Obama get away with language like this?
Is this a ghetto/ thug mentality? 

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Gulf Oil Spill Blame Game
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Obama $77,051 Biggest Recipient Of BP Cash
Obama’s Oil Spill Spreads To Florida
New Orleans New Disaster, Obama’s Oil Spill

Obama Brush Aside Gulf Oil Spill, Leave It Up To BP
Underwater Footage: Gulf Of Mexico Oil Spill

Impeach Obama
Michelle Obama Announces Childhood Obesity Guidelines
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Gulf Oil Spill Blame Game




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Obama Brush Aside Gulf Oil Spill, Leave It Up To BP
Underwater Footage: Gulf Of Mexico Oil Spill

Impeach Obama
Michelle Obama Announces Childhood Obesity Guidelines
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Gulf Oil Killing Wildlife

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Obama $77,051 Biggest Recipient Of BP Cash

Sarah Palin accused US President Barack Obama on Sunday of leading a lax response to the Gulf of Mexico spill because he is too close to the big oil companies. BP and its employees have given more than $3.5 million to federal candidates over the past 20 years, with the largest chunk of their money going to Obama, according to the Center for Responsive Politics. Donations come from a mix of employees and the company’s political action committees — $2.89 million flowed to campaigns from BP-related PACs and about $638,000 came from individuals. During his time in the Senate and while running for president, Obama received a total of $77,051 from the oil giant and is the top recipient of BP PAC and individual money over the past 20 years, according to financial disclosure records. Center for Responsive Politics.

Presidential Fundraising and Spending, 1976 – 2008

Total Contributions to
Presidential Candidates*

Total Receipts
Year
2008
2004
2000
1996
1992
1988
1984
1980
1976
Total
$1,748.8
$880.5
$528.9
$425.7
$331.1
$324.4
$202.0
$161.9
$171.0
Primary Receipts
General Election Public Funding
General Election Private Funding
Convention Public Funding

Total Spending by
Presidential Candidates*

Total Spent
Year
2008
2004
2000
1996
1992
1988
1984
1980
1976
Total
$1,324.7
$717.9
$343.1
$239.9
$192.2
$210.7
$103.6
$92.3
$66.9

* In millions
Numbers are not adjusted for inflation.

In 2008 alone, BP gave $37,000 to members of the House Energy Committee and $106,501 to members of the Senate Homeland Security Committee, which deals with security issues facing the nation’s oil supply. Other politicians with ties to coastal states or states with BP refineries have also reaped benefits from the fourth largest company in the world. The top congressional recipients of BP campaign cash include Republican Rep. Don Young of the oil-intensive Alaska delegation, who has received almost as much as Obama, raking in $73,300 during his congressional tenure. Also on the list is Sen. George Voinovich (R-Ohio), whose state has a BP refinery in Toledo and who has raked in $41,400. Sen. John McCain (R-Ariz.) has received $44,899.

University of California $1,591,395
Goldman Sachs
$994,795
Harvard University $854,747
Microsoft Corp
$833,617
Google Inc $803,436
Citigroup Inc
$701,290
JPMorgan Chase & Co
$695,132
Time Warner
$590,084
Sidley Austin LLP $588,598
Stanford University $586,557
National Amusements Inc $551,683
UBS AG
$543,219
Wilmerhale Llp $542,618
Skadden, Arps et al $530,839
IBM Corp $528,822
Columbia University $528,302
Morgan Stanley
$514,881
General Electric
$499,130
US Government $494,820
Latham & Watkins $493,835

BP has also evolved in its corporate giving over the past decade, shifting more money to Democrats. In 2000, the company gave almost 39 percent more to Republicans than to Democrats. But by 2008, Democrats had nearly pulled even with Republicans on BP donations.

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Underwater Footage: Gulf of Mexico Oil Spill

BP (NYSE:BP) has released footage of their remote operating vehicle (ROV) successfully capping one of the three leaks that is pouring an estimated 5,000 barrels of oil a day into the waters off the Gulf of Mexico.

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Obama Executive Order On Abortion Funding

EXECUTIVE ORDER

ENSURING ENFORCEMENT AND IMPLEMENTATION OF ABORTION RESTRICTIONS IN THE PATIENT PROTECTION AND AFFORDABLE CARE ACT

By the authority vested in me as President by the Constitution and the laws of the United States of America, including the “Patient Protection and Affordable Care Act” (approved March ¬¬__, 2010), I hereby order as follows:

Section 1. Policy.

Following the recent passage of the Patient Protection and Affordable Care Act (“the Act”), it is necessary to establish an adequate enforcement mechanism to ensure that Federal funds are not used for abortion services (except in cases of rape or incest, or when the life of the woman would be endangered), consistent with a longstanding Federal statutory restriction that is commonly known as the Hyde Amendment. The purpose of this Executive Order is to establish a comprehensive, government-wide set of policies and procedures to achieve this goal and to make certain that all relevant actors—Federal officials, state officials (including insurance regulators) and health care providers—are aware of their responsibilities, new and old.

The Act maintains current Hyde Amendment restrictions governing abortion policy and extends those restrictions to the newly-created health insurance exchanges. Under the Act, longstanding Federal laws to protect conscience (such as the Church Amendment, 42 U.S.C. §300a-7, and the Weldon Amendment, Pub. L. No. 111-8, §508(d)(1) (2009)) remain intact and new protections prohibit discrimination against health care facilities and health care providers because of an unwillingness to provide, pay for, provide coverage of, or refer for abortions.

Numerous executive agencies have a role in ensuring that these restrictions are enforced, including the Department of Health and Human Services (HHS), the Office of Management and Budget (OMB), and the Office of Personnel Management (OPM).

Section 2. Strict Compliance with Prohibitions on Abortion Funding in Health Insurance Exchanges. The Act specifically prohibits the use of tax credits and cost-sharing reduction payments to pay for abortion services (except in cases of rape or incest, or when the life of the woman would be endangered) in the health insurance exchanges that will be operational in 2014. The Act also imposes strict payment and accounting requirements to ensure that Federal funds are not used for abortion services in exchange plans (except in cases of rape or incest, or when the life of the woman would be endangered) and requires state health insurance commissioners to ensure that exchange plan funds are segregated by insurance companies in accordance with generally accepted accounting principles, OMB funds management circulars, and accounting guidance provided by the Government Accountability Office.

I hereby direct the Director of OMB and the Secretary of HHS to develop, within 180 days of the date of this Executive Order, a model set of segregation guidelines for state health insurance commissioners to use when determining whether exchange plans are complying with the Act’s segregation requirements, established in Section 1303 of the Act, for enrollees receiving Federal financial assistance. The guidelines shall also offer technical information that states should follow to conduct independent regular audits of insurance companies that participate in the health insurance exchanges. In developing these model guidelines, the Director of OMB and the Secretary of HHS shall consult with executive agencies and offices that have relevant expertise in accounting principles, including, but not limited to, the Department of the Treasury, and with the Government Accountability Office. Upon completion of those model guidelines, the Secretary of HHS should promptly initiate a rulemaking to issue regulations, which will have the force of law, to interpret the Act’s segregation requirements, and shall provide guidance to state health insurance commissioners on how to comply with the model guidelines.

Section 3. Community Health Center Program.

The Act establishes a new Community Health Center (CHC) Fund within HHS, which provides additional Federal funds for the community health center program. Existing law prohibits these centers from using federal funds to provide abortion services (except in cases of rape or incest, or when the life of the woman would be endangered), as a result of both the Hyde Amendment and longstanding regulations containing the Hyde language. Under the Act, the Hyde language shall apply to the authorization and appropriations of funds for Community Health Centers under section 10503 and all other relevant provisions. I hereby direct the Secretary of HHS to ensure that program administrators and recipients of Federal funds are aware of and comply with the limitations on abortion services imposed on CHCs by existing law. Such actions should include, but are not limited to, updating Grant Policy Statements that accompany CHC grants and issuing new interpretive rules.

Section 4. General Provisions.

(a) Nothing in this Executive Order shall be construed to impair or otherwise affect: (i) authority granted by law or presidential directive to an agency, or the head thereof; or (ii) functions of the Director of the Office of Management and Budget relating to budgetary, administrative, or legislative proposals.

(b) This Executive Order shall be implemented consistent with applicable law and subject to the availability of appropriations.

(c) This Executive Order is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity against the United States, its departments, agencies, entities, officers, employees or agents, or any other person.

THE WHITE HOUSE

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Obama’s Oil Spill Spreads To Florida

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Dollar Losing Value Under Obama

dollar2A report last week in The Independent claiming that China, Russia and Gulf States are among nations prepared to ditch the dollar for oil trades has heightened the uncertainty surrounding the US currency’s future. The U. S. dollar faces increased pressure as the financial crisis allows emerging economies greater influence on the world stage. The dollar slumped against rivals last week.

The Gulf Arabs, China, Russia, Japan and France plan to switch to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar. This would mean an end to dollar dealings for oil. Obama and all the Liberal Democrats should be jumping up with joy since they want to alternative energy. How many years have you heard some Liberal talking about the dangers of Oil and George Bush Oil buddies, and Oil This, Oil That? Now these same fools are running around trying to save the dollar to purchast….OIL. John Q. Public, if you sit back and let the Liberal fools do their thing you will see how foolish they look and sound.

Since Obama has been in office the Dollar Value has dropped to an all time low. Remember the G20 summit in Pittsburgh last month, world leaders unveiled a new vision for economic governance, with bold plans to fix global imbalances and give more clout to emerging giants such as China and India. Who was left out? The United States. Following the summit, US Treasury Secretary Timothy Geithner repeated Washington’s commitment to a strong dollar. Two weeks later the Gulf Arabs, China, Russia, Japan and France plan to switch currencies for oil purchases. Who did they leave out, Obama and the United States.

dollar&bullsatnewlowchartEWTHow do we determine the relative value of an amount of money in one year compared to another? There is no correct measure, and economic historians use one or more different indicators depending on the context of the question.

  • The CPI is most often used to make comparisons partly because it is the series with which people are most familiar. This series tries to compare the cost of things the average household buys such as food, housing, transportation, medical services, etc. For earlier years, it is the most useful series for comparing the cost of consumer goods and services. It can be interpreted as how much money you would need today to buy an item in the year in question if its price had changed the same percentage as the average price change. Construction of CPI Indicator
  • The GDP Deflator is similar to the CPI in that it is a measure of average prices. The “bundle” of goods and services here includes all things produced in the economy, not just consumer goods and services that are reflected in the CPI. Construction of GDP Indicator
  • The Consumer Bundle is the average dollar value of the annual expenditures of a “consumer unit”. The consumer unit could be a family or another type of household. The main point is that spending is a joint decision of the members of the unit. The bundle increases over time as household income increases. Unlike the CPI, not only the cost but also the amount of goods and services increases over time. Note, the 2008 value of the consumer bundle will not be published until November 2009. Link to the Consumer Bundle Indicator
  • The Unskilled Wage Rate is good way to determine the relative cost of something in terms of the amount of work it would take to produce, or the relative time it would take to earn its cost. It can also be useful in comparing different wages over time. The unskilled wage is a more consistent measure than the average wage for making comparisons over time. Construction of Unskilled Wage Indicator
  • The GDP per capita is an index of the economy’s average output per person and is closely correlated with the average income. It can be useful in comparing different incomes over time. Construction of GDP Indicator
  • The GDP is the market value of all goods and services produced in a year. Comparing an expenditure using this measure, tells you how much money in the comparable year would be the same percent of all output. Construction of GDP Indicator

Lets look at comparisons in US dollars between any two years from 1774 to 2008. They are the CPI, the GDP Deflator, the consumer bundle, the unskilled wage rate, the GDP per capita, and the GDP.

  • George Washington was paid a salary of $25,000 a year from 1789 to 1797 as the first president of the United States. The current salary of the president has recently been doubled to $400,000. Making a comparison using the CPI for 1790 shows that $25,000 corresponds to over $608,000 today, so the recent raise means current presidents have an equal command over consumer goods. When comparing Washington’s salary to an unskilled worker, or the measure of average income, GDP per capita, then the comparable numbers are $11.5 and $25 million. To show the “economic power” of his wage, we see that his salary as a share of GDP would rank him equivalent to $1.9 billion.
  • The Civil War lasted from 1861 to 1865 and has been estimated to have direct cost about $6.7 billion valued in 1860 dollars. If this number were evaluated in dollars of today using the GDP deflator it would be $137 billion. The relative value of $6.7 billion of 1860 would be $22 trillion today, or about 145% of our current GDP.
  • The Model T Ford cost $850 in 1908; by 1925 the price had fallen to $290. Using the CPI, the GDP deflator or the consumer bundle, $850 in 1908 is equivalent to between $1,485 and $1,670 in 1925. Using the wage indicator we see that the labor cost of the 1908 car in 1925 wages was $2,094 and by using the GDP per capita indicator it was $1,957. If we wanted to consider the costs of the Model T using today’s prices we would find that the $850 cost in 1908 is $19,760 in today’s prices using the CPI, $14,700 using the GDP deflator, about $45,000 using the consumer bundle, $84,700 using the wage indicators, and $115,000 when comparing using the GDP per capita.
  • Babe Ruth signed a contract on March 10, 1930 with the American League Base Ball Club of New York (The Yankees) to play baseball for the next two years at an annual salary for $80,000. In 2008 the CPI was 14.1 times larger than it was in 1931 and the GDP deflator 11.6 times larger. If we want to compare Ruth’s earnings using the index of what the average household buys, it would be over $2,200,000 today. The relative cost of unskilled labor is 42 times higher in 2008 than in 1931. So if we wanted to compare his wage to what someone selling hot dogs would earn, we could say his “relative wage” is $3,200,000.

GDP per capita and GDP are 747 and 189 times larger in 2008 than they were in 1931. Ruth’s earnings relative to the average output would be $5,100,000 today. As a share of GDP, Ruth “output” that year would be $12,670,000 in today’s money.

obama+deficitOver the past 5 years, our federal debt has increased by $3.5 trillion to $8.6 trillion.  That is money that we have borrowed from the Social Security trust fund, borrowed from China and Japan, borrowed from American taxpayers. And over the next 5 years, between now and 2011, the President’s budget will increase the debt by almost another $3.5 trillion. This year the Federal Government will spend $220 Billion in interest. That is more interest to pay on our national debt, education, homeland security, transportation, and veterans benefits combined. Listen to what Senator Barack Obama said March 16, 2006 Senate Floor Speech on Public Debt. No wonder China, Russia and Gulf States are  prepared to ditch the dollar for oil trades.

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