And the White House's next argument for the Iran deal will be...
It’s coming, and coming soon. The arguments so far have not worked because they are flawed.*
But here is the next likely reason they will proffer to support the deal with Iran. And it is a base one: the price of a gallon of gas will go down at the pump.
Oil just hit a 6-year low. There are many reasons why this has been case. The world’s economies have been slowing (especially China), so oil demand is plummeting. New sources of oil and gas are being explored. The Saudis and others are producing as much as they can to weaken Iran. Iraq oil production is ramping up. Oil exporting nations are scrambling for market share so boosting production. Russia also needs all the oil revenue it can since its economy is in a free fall. Fracking technologies continue to move forward. The latest news is that a previously fracked field can be “fracked” up to 8 times to gather more oil. The Sunni oil-exporting nations are trying to bankrupt their competitors here in America, who are fracking domestically and are exploring options to do so overseas.
Speculators who have been hoping for higher prices are being “broken” and have had to unload a lot of oil and oil-linked contracts. Oil that has been stored in oil tankers offshore has been a bet that has gone wrong, and people know this oil will have to return to the market as the costs of storage continues to wreak havoc on hedge funds. A strong dollar reduces oil prices worldwide since commodities generally are priced in dollars.
Most of the decline that has occurred in the price of crude has yet to work its way to the gas pump because of the nature of the industry – it takes a while for crude price declines to be reflected at the local gas station as higher priced inventory has to be worked off (the dynamics at work have been characterized to a pig in a python).
Just wait until oil companies have to revalue the assets on their balance sheets. The DJIA will not be happy. In fact, all resource prices are plummeting – not just oil – and those resources (copper, lumber, iron ore, aluminum, silver, gold) do not come from Iran. We live in a world of plenitude when it comes to natural resources, with more efficient production and use and recycling all depressing prices.
But the devious minds in Washington will see an opportunity to tout that oil has been plummeting because of the prospects of more Iranian oil entering the world market. Their appeal to Americans will be couched as a pocketbook issue – as if the tax-raisers in the White House care about people’s savings. If the White House actually cared about cheap oil, they would issue permits for exploration and development on federal lands, allow the Keystone pipeline to be built, release offshore tracts for development, and take many other steps to unleash the wealth lying under our land.
But here will be the message broadcast over and over: do you want oil prices to go down? Then support the Iran deal. Their pitch will play on people’s desire to save money, regardless of empowering the most evil and American-hating regime on earth. As Vladimir Lenin wrote about capitalists, “give him enough rope, and he’ll hang himself.” Give the mullahs enough money, and they will kill a lot of innocent people. Plus a nuclear Iran will be in a position to create chaos and dictate much higher prices for oil. But the administration will not point those caveats out – officials will just dangle cheap oil for Americans.
It will be a simple message, like most lies. Oil is going down for the reasons noted above. But propaganda does not care about facts.
* Barack Obama, John Kerry, and their minions who have come out in favor of the deal they have reached with the Iranian mullahs have trotted out many absurd arguments to convince people to support it. These include the idea that it will encourage the number one terror-sponsoring nation on earth to moderate its behavior. That will not happen; the entire regime is based on hatred of America. After all, it has the blood of thousands of Americans on its hands (see this powerful commercial) and still touts its desire to destroy America.
In fact, the $100-billion windfall (and more to follow) will enable the most hardline elements to consolidate their power inside Iran and export their terror outside Iran. The White House claims that it will prevent Iran from developing nuclear weapons (it won’t – for a list of failed claims this administration has made about the Middle East, see this column by Max Boot, aptly titled, “Consistently Wrong”) and will empower the regime to develop a nuclear infrastructure that will allow them to turn out ballistic missiles and nuclear weapons like sausages (hat tip: Nikita Khrushchev). The master negotiators (appeasers) on our (?) side will eventually remove the arms embargo on Iran that has restrained its behavior and will allow terror masterminds to travel the world, free from INTERPOL and other authorities that have previously restricted their operations.
Kerry has lately made the absurd claim that the American dollar may lose its reserve status as the world currency if the deal is rejected (to be replaced by what? The ruble? The yuan? The euro?). This will be supposedly because nations won’t respect us for not reaching a deal with Iran. Clearly, he wants the Nobel Peace Prize since Americans rejected him as president (this is what embittered presidential candidates get when they take positions Euro-elites support).