Good day all. If you had any doubts that Kalifornistan, formally known as California, has become a socialist totalitarian state, their latest “Brilliant” idea will correct that. There are discussions about the State taking over oil refineries as a way to lower gas prices.
Kalifornistan’s energy costs are the highest in the nation due to a combination of massive taxes and regulations. Fuel prices in Kalifornistan generally run $1-$3 above the rest of the country. This puts a major bite into the middle class’s budgets. Many trucking companies will top off their tanks before crossing into Kalifornistan to save money.
Kalifornistan is also working to outlaw the internal combustion engine and intends to ban cars by 2035. (This assumes that Kalifornistan still exists as a single state entity by then and hasn’t wither collapsed or been forcibly broken up into separate states by the Federal Government) Because of the massive taxes and regulations, energy companies as well as other industries have been pulling out of the state.
However, there are a few refineries in Kalifornistan that produce the specialized formulations required by the regulators. These formulations are expensive to produce and since few other states use them, the economies of scale aren’t really working. This leads to the high gas prices the serfs people of Kalifornistan are suffering from. The answer from the State Politiboro? How about we run the refineries instead? Here are some of the details from the L.A. Slimes:
It’s becoming increasingly clear in Sacramento: The administration of Gov. Gavin Newsom is intent on pumping up state power to oversee the slow decline of California’s gasoline refinery industry.
It remains to be seen whether the state Legislature will go along.
Oh I think they will. They are all Communist Totalitarians Democrats who believe in centralized power to the Ruling Elites. (That would be the Democrats in Sacramento)
Newsom called a special legislative session to address gasoline price spikes, such as the one last year that sent per-gallon costs soaring past $7 a gallon in parts of the state. An Assembly committee held two hearings last week, with another set for Thursday.
Do you think that they might consider rolling back the massive gas taxes and regulations that stifle fuel production?
Under immediate consideration: a bill that would allow the state to set minimum levels of gasoline storage at California’s refineries. The intention: to balance supply and demand to prevent retail price spikes when a refinery temporarily shuts down for maintenance.
When a refinery shuts down for maintenance, they shut down completely. This means draining everything that can catch fire and explode from all the tanks, pipes and other systems so that don’t catch fire or explode. The last thing they want to do is have storage tanks full of fuel on site. In fact, any tanks on site would be drained so they can be inspected and repaired as needed.
But a bigger issue goes well beyond mundane matters of gasoline storage. The Legislature faces a fundamental question of government philosophy: How deeply should the state manage and control an industry that faces steady decline due to the state’s own policies, an industry that sells a product that will remain essential to a smooth-functioning economy even as it fades away?
First, fossil fuels aren’t fading away. Kalifornistan, and a number of poorly run Blue states have decided that they will outlaw anything that uses fossil fuels. That there is no real replacement doesn’t concern them. As to how much the State should manage private businesses such as the energy sector? How does not at all strike you?
And it faces another question: If the state decides to go deep, will it prove itself capable? The answer carries enormous implications for the household budgets of millions of Californians who will continue to drive gasoline-powered cars for years to come.
I can answer this if the Los Angeles Slimes can’t, or more likely won’t. If the politicians and state regulators try running the refineries, they will screw it up by the numbers, just as the screw up everything they get their grubby hands on.
Kalifornistan, or at least that incompetent tyrant Govno Gavin “Hair Gel” Newsom, has decreed that the sale of any new cars using standard engines, those powered by fossil fuels, will be banned. Aside from the legality of this, (Interstate commerce and the Commerce Clause) , there will be millions of cars on the roads in the state.
Therein is the rub. Oil companies, actually I think it’s refining companies, I don’t know of the major oil companies actually own the refineries in Kalifornistan, and I’m to lazy to look it up, have just about had it with the State government and are looking to pull out of the state entirely.
So the state government is in a pickle. It wants to keep gasoline prices reasonably low, while state refineries, with no light at the end of their tunnel, want to pull in all the cash they can before their business disappears. If refineries cut back operations or close, or if their supply chains are disrupted, demand might exceed supply and drive up overall prices.
“As demand for gasoline declines, the industry will become more concentrated and potentially less competitive,” the California Energy Commission said in a recent report.
I wouldn’t put much stock in that report. While I didn’t read it, (89 pages of bureaucratese), it’s going to make assumptions that probably are completely wrong. To begin with, the harbors in Kalifornistan handle millions of tons of goods each year. Those goods need to be shipped out of the state. (There’s the interstate commerce thing) Anything that disrupts that process hurts the entire country and to some extent, the entire world economy.
If the People’s Democratic Republic of Kalifornistan thinks that the Federal government is going to allow them to wreck the economy, they need to put down the Crack pipe, sober up and think again. While the current maladministration might let them get away with it, more then half the states won’t. The worst case scenario? A new “War between the states” where Kalifornistan is flat out invaded and taken over.
Of course, Govno Newsom and the Democrats think they are right and everyone else is wrong. After all, Newsom is rich and the Democrats are made up of people who spent decades in the “Correct” schools learning the “Correct” things. They know exactly what needs to be done and they will do it, come Hell or high water.
Newsom’s solution is heavier state intervention. The gasoline storage mandate is only the beginning. The recently created Division of Petroleum Market Oversight is ironing out details of a plan to financially penalize refineries that exceed a state-set profit margin that’s yet to be determined, and is investigating the opaque machinations of the spot market for petroleum products.
Oh that’s going to work out real well. If they want to shut down the refineries a lot sooner than anyone planned, this will do it. This is right out of the old Communist playbook and will work about as well. (In other words, it will be a complete failure.
The article goes on to list a number of really stupid ideas. Limiting profits on retail gasoline sales, (Basically telling gas stations how much they will be permitted to make), leasing or buying both tanker ships and storage tanks and the seizure of the oil refineries in the state.
“The State of California would purchase and own refineries in the State to manage the supply and price of gasoline,” reads a report issued in draft version in May by the Energy Commission.
That has worked out so well with every other fascist, communist regime.
The industry, unsurprisingly, is not pleased. The main complaint: State managers can’t grasp the complexities of the gasoline production and supply system, and what’s seen as outside interference could increase prices if the system is made less efficient. Plus, they complain, over the decades, state taxes and mandates have been a prime cause of high gasoline prices in California.
“We are walking and walking and inching toward the Energy Commission … managing these refineries,” Eloy Garcia, a lobbyist for the Western States Petroleum Assn., told legislators. “We heard [at the hearing] that they are going to help us engineer the refinery. We heard they are going to tell us when to do maintenance. They’re going to tell us how much more supply, how to configure our tanks.”
Those morons in Sacramento do not have any idea what they are doing. They are basically seizing control of the refineries without actually doing the whole Eminent Domain thing. They are planning to regulate the plants to death. This will be a new way to “Nationalize” a business. It will fail. Of course, the moronic moonbat pushing this crap doesn’t see the problem.
Assemblymember Steve Bennett (D-Ventura) defended deeper state involvement while acknowledging that refineries are businesses driven by profits: “While I recognize that the industry has an obligation to maximize profits, we have an obligation also to maximize what’s in the interests of the public.”
The levels of stupidity continues in the Slimes article. They talk about mandatory storage levels, (Have any of these losers looked at what their president has done to the Strategic Petroleum Reserves?), with absolutely no comprehension of the business and the margins they operate under. They’re also not considering other problems with their plans.
What happens if the refineries refuse to play along? Is the state going to just steal take the plants under eminent domain? To begin with, where is the money going to come from? It’s going to cost billions to take a refinery, billions the State doesn’t have. Then, if they’re successful, who is going to staff the plant? You can bet the management is going to leave and I suspect a good number of the employees as well.
Then they have another problem. Where are they going to get the oil to refine? If the State were to take the refineries in Kalifornistan, (I checked and it looks like they have 15 in place), there is a good bet that the oil companies will just not sell to them. Are they going to import product? Then you might have a problem with the federal government. Another issue is that refineries don’t just produce fuels. They also produce things used in plastics, lubricants and feed stocks.
It’s reaching the point where companies will simply tell the political class in Sacramento to go pound sand and flat out refuse to follow their increasingly totalitarian regulations. If the state were to send in state police to take the plants, I wouldn’t be at all surprised that certain mission critical parts suddenly went missing.
In the end, it’s going to take the remaining residents of Kalifornistan to wake up and realize that the political elites do not have the citizens interests in mind. Until they do, Kalifornistan is going to continue circling the drain and become a failed American state.
Thatisall
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