Open Letter To Jim Cramer
on Oil Spills
(2008 Oct 13)
(2008 Oct 13 email/blog-post)
! Note !
A few more comments or web links may be added,
if I ever re-visit this page.
Following is an e-mail that I sent to Jim Cramer c/o madmoney at cnbc.com. It probably ended up in the great CNBC bit bucket. But I preserve the email here, because Jim Cramer (and most other people in the USA) do not seem to know of the tar-balls-on-the-beaches experience of California back in the 1960's.
Meanwhile our congress people ignorantly desire to threaten our beaches and estuaries (for example, oysters and fish in Chesapeake Bay) in a stupid attempt to get a few more years of oil for their gas guzzlers.
That paltry amount of oil won't keep the gasoline prices from going over 5 dollars per gallon in the next decade or so. Yet politicians are willing to significantly damage the tourism and seafood industries. What lack of perspective!
How about doing something with some foresight? How about a program to build out electrical transmission infrastructure to support a build-out of wind farms and solar farms in the midwest and on the coasts? Like the Rural Electrification Program of the 1930's that brought electricity to farms across the country when no private enterprises would advance the money to do such a thing.
The letter to Cramer follows.
SUBJECT: Oil Tar Pollution
13 Oct 2008
Like many others, I appreciate the way you try to help people learn how the stock market (mis)behaves. You are a teacher of some depth, while most others in your field simply repeat the same tired old (mostly untrue) phrases --- and some others in your field seem to be trying to promote themselves as high-priests of economics while generating very little light.
Having said that, I usually evaluate the things you say against personal experience, rather than simply accepting every statement as fact.
One thing you have been harping on in quite a few Mad Money programs in the past few months is how you believe that oil drilling is so technologically advanced now that there is almost no chance of oil "spills".
I think there are many people in Southern California, who remember their beaches back in the middle 1960's, who would disagree.
[INSERT, a couple of years after sending this email:
But he does quite frequently point out occasions when he called a stock advance successfully, while seldom pointing out the many times he was wrong. And sometimes he makes up or exaggerates instances where he claims to have predicted something successfully. He does not manufacture predictions nearly as much as some financial 'wizards', however --- to his credit.]
I was walking on Malibu Beach in 1966 and found it almost impossible to walk without getting tar on my feet. There were tar balls on the sand, about every square foot or so, as far as the eye could see. And no telling the amount of oil liquids, including benzene compounds and the like, that were mixed into the sea or evaporated into air --- but it must have been considerable, judging from all the tar balls.
The beach experience was totally ruined for me, as it was, no doubt, for many tourists and residents there.
When I was there again around 2004, there were no tar balls on the beach. The difference was --- essentially no more offshore drilling along those beaches in Southern California.
No doubt, drilling has advanced a lot in 40 years, but I do not think that leakage can be contained as completely as you think.
I am willing to put my money where my mouth is. I am willing to bet you $1,000 that if drilling is started off-shore of Virginia Beach (VA) or Daytona Beach (FL) or Malibu Beach (CA), that, within a few years of significant drilling activity and oil strikes, production worthy or not, the beaches will be covered with tar balls.
I would be interested if some of your California listeners who are more than 60 years old can confirm my experiences on their beaches --- and can confirm my concerns about renewed drilling.
In any case, with 6 billion people on the planet now and oil usage growing, U.S. offshore drilling will satisfy this nation's needs for no more than 10 to 20 years, or thereabout. And off-shore drilling is a HECK OF A LOT more expensive than land-based drilling, like land drilling in Texas, Oklahoma, Saudi Arabia, Canada, Mexico, Venezuela, etc. So gasoline prices are likely to stay above $3.50 per gallon even if we are using mostly U.S. oil.
It's time for the foot dragging to stop and for the U.S. to start developing non-carbon, non-radioactive energy sources --- wind, solar, geothermal, bio-oil, and ocean (waves, tides, currents). Wind now --- others later.
It amazes me that people (like Palin and McCain) ignore the fact that Boone Pickens was a life-time oil-man, and he sees that the future, one that is in the best long-term interests of the U.S., is in wind --- and natural-gas, with other sources, such as bio-oil, taking over as natural-gas supplies diminish.
Pickens is not even suggesting that opening up Alaska to more drilling or building more nuclear plants is the proper solution.
I don't know about you and your listeners, but I think Boone Pickens is much more to be trusted on energy matters than Palin and McCain. But maybe that's because I was a "doodle-bugger" in the 1960's, i.e. I worked in the seismic oil exploration business, and I know that most of the easily recoverable U.S. oil is gone.
I know that Pickens is not trying solely to line his own pockets. I regard him as a true patriot. The energy tangent, on which Palin and McCain would take us ('drill, baby, drill'), is a danger to the future of this country, as a world leader among nations.
Asia and Europe and Brazil are likely to out-pace the U.S. in the area of energy-generation, if the short-sighted Palin-McCain path is followed.
Cheers, B... M...
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Emailed (and this page posted here) 2008 Oct 13.