Al Gore’s self-aggrandizing claim that he “took the initiative in creating the Internet” has haunted him since he first uttered it during a 1999 CNN interview. It makes sense. In a society where people expect to be rewarded for their hard work and good ideas, the public generally abhors those who take credit where it’s not due.
For those reasons and others, politicians—especially those seeking reelection—should avoid engaging in unwarranted swagger. President Obama did not.
During his State of the Union address, he applauded his administration for the recent boom in U.S. oil and gas production. Yet as the Institute for Energy Research demonstrates, this growth happened in spite of his policies, not because of them:
The increase in production is occurring on private and state lands, the use of which is much harder for the President to restrict (at least in the short term). Meanwhile, production on federal lands is decreasing significantly … [His] administration did not hold a single offshore lease sale in fiscal year 2011.
President Obama didn’t stop there. He also claimed that it was the federal government via “public research dollars” that was responsible for inventing hydraulic fracturing and the horizontal drilling techniques which are enabling us to extract previously inaccessible oil and gas from shale, coal seams, and other hard to reach areas. He’s angling for part of the credit for America’s current gas boom. (Note: Fracking has been around since 1947—14 years before the President was even born.)
One can only assume the President’s bold claim referred to the now expired Section 29 tax credit, a provision which allowed natural gas producers to keep more of their revenue on wells drilled before 1992 and, therefore, incentivized companies to direct more private capitol back toward these activities. This kind of standard business deduction is a far cry from the taxpayer funded research the President described.
For an example of actual subsidies (ie. government handouts), look no further that the White House’s own pet “green” projects. In his address, President Obama announced plans to direct more tax dollars toward the renewable energy sector—industries that already receive an estimated $11.3 billion in annual subsidies. Despite decades of these substantial taxpayer investments, alternative energy sources only account for about 8 percent of the U.S. energy supply.
Campaign rhetoric aside, the natural gas boom has emerged as a result of substantial private sector investment by the very oil and gas firms the President claims are earning too much. Is capital investment something he claims to be encouraging?
The federal government does not operate on a strict budget (ie. $15.2 trillion and rising debt), is not focused on generating revenue, and has proved to be an ineffective venture capitalist (ie. Solyndra). Is it so crazy to leave trust some of the most innovative and profitable companies in the world to effectively invest the revenue they generate?