Well, they did it.
The GOP took control of the Senate.
Republicans all over the country this morning are celebrating, and the folks who voted for them are chest pounding about how things are finally going to change.
Of course, nothing could be further from the truth.
The bottom line is that there’s little difference between the jackass and the elephant. This is a reality few want to accept, but it’s a reality nonetheless.
That being said, with the Republicans now in control of the Senate, we do need to take a look at how this affects us as energy investors. So let’s get to it.
Big Oil Sugar Daddy
During this last election cycle, there was a fair amount of criticism of Obama and his anti-drilling stance.
The only problem is that it’s not true.
Despite it having nothing to do with him at all, the biggest increase ever seen in U.S. oil production has occurred under the Obama administration. It was a gift to this administration courtesy of technological breakthroughs, increased threats of foreign oil reliance, and $100 oil.
Although conservatives want to paint him as an enemy of domestic oil production, he really isn’t. From approving underwater seismic testing off the Atlantic Coast to swooning over the frack machine that he leans on to chest-pound about being in control of our own energy future — Obama is no less supportive of Big Oil than George W. Bush.
Moreover, while there are plenty of Democrats that’ll speak out against the evil empire of Big Oil, few turn away their “donations.”
The bottom line is that this country is so reliant upon “cheap” oil that no matter who controls Congress or who squats at 1600 Pennsylvania Avenue, the sugar daddy that is Big Oil will never be dumped by Washington.
So what does this mean? It means you should use these dips in oil prices to buy domestic oil plays like these.
It also means that if you’re pro-oil, don’t let conservative lobbying groups sucker you out of money by telling you those pesky liberals in Washington are going to ruin everything. Those “pesky liberals” don’t have the power or the desire to do so.
If you’re anti-oil, then I suggest you buy an electric car and be done with it.
King Coal Dethroned
They’ve been calling it the war on coal.
I call it progress, technological innovation, and evolution.
No matter how you slice it, thermal coal will eventually go gently into that good night.
Between dirt-cheap natural gas and rapid declines in production costs for renewables, thermal coal’s days are numbered.
Have Democrats attempted to expedite this coal finale? Perhaps. At least the ones that don’t live in coal states.
But the real threat to coal isn’t environmentalists or liberals or socialists or whatever they’re being called this week. The real threat to coal is competition. And this competition will continue to intensify regardless of who’s dragging his knuckles through the halls of Congress.
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Socialist, Liberal Tree Huggers
Just as conservative groups like to rally the troops by pretending Democrats are anti-oil or anti-coal, liberal groups also dip their toes into the waters of misinformation and empty rhetoric.
You’ll be hard-pressed to find a liberal Democrat who knows that a good majority of renewable energy integration is actually happening right now in Republican-controlled territories.
The truth is, wind power has long found supporters in red states where the wind resource is robust and the wind energy-related jobs are key contributors to economic growth. We see the same with biofuels, despite ethanol being one of the biggest welfare scams ever to come out of Washington.
Self-proclaimed pro-free market forces within the GOP may talk a good game on camera, but many are more than happy to take a handout from Uncle Sam so they can force us all to put corn in our gas tanks.
At the federal level, you won’t see much in the way of obstruction for electric vehicles, as electric vehicle sales barely register as an accounting error compared to peddlers of internal combustion vehicles.
And despite some conservative political action committees dedicated to halting the rapid integration of solar, there are just too many economic advantages for these folks to get much of a foothold.
Aside from some Republicans that will fight the solar investment tax credit extension next year, there are plenty of Republican lawmakers representing states where solar jobs and tax revenue is abundant.
So the point to all of this is simple…
The government is useless, it will not offer up any commonsense energy policies, and things will continue to chug along as they have.
Of course, this begs the question, why is the government even involved with energy policy to begin with? And that, dear reader, is what we really should be asking ourselves.
Forget the platforms, forget the promises, forget the campaigns. For a real free market to work properly, the government should be removed from the energy space completely.
But I’m not holding my breath on that one. So in the absence of such a thing, you and I will continue to use the electricity and transportation fuels the government has decided are best.
You will get no argument out of me for reacting to this truism in a hostile manner. But keep your wits about you, and invest accordingly.
To a new way of life and a new generation of wealth…
Jeff Siegel
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Jeff is the founder and managing editor of Green Chip Stocks. For more on Jeff, go to his editor’s page.
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