You wont see it in any campaign finance reports. But you, me, and just about everyone you know made a generous campaign donation to Russias maximum leader, Vladimir Putin, whose party won a thumping victory in parliamentary elections last week.
Feel like taking a shower? How about a cup of CAFE instead?
Putin has been getting very big for his britches lately. While his second and final term as Russias president will expire next March, it is clear that he is finagling ways of maintaining his czar-like position atop the Kremlin heap.
And why is he able to do that? High-priced oil. At a price of $85 per barrel, Russia, the worlds second largest oil producer, takes in more than $120 billion per year from crude oil exports alone. Revenue from exporting pricey oil has pulled Russia a long way away from the besotted, threadbare era of Boris Yeltsin.
Oil wealth has enabled the strongman habits that Russia has a hard time kicking. An ex-KGB guy, Putin is only too happy to oblige.
But getting back to our campaign contributions to Putin. By now, you realize Im talking about our oil purchases, which serve Putin's purposes by feeding the Russian treasury and strengthening his political position. U.S. imports of Russian oil and oil products have grown dramatically since 2004, and now total about 500,000 barrels per day.
More importantly, our demand for oil helps keep prices high. U.S. demand is not the only factor. The weaker dollar, Chinas and Indias growth, declining output in older fields, and a fear premium tied to actual or potential disturbances in oil-producing regions also power the price train.
Still, despite all you hear about China and India, the U.S. is still the big tuna of global oil demand. Since oil is traded and priced in a global market, our demand puts upward pressure on prices. Which is wonderful news for Vladimir Putin.
How do we wipe that smirk off his face? It starts with conservation, which, Dick Cheneys hostile attitude notwithstanding, must be the foundation of our nations energy policy. The most important thing we can do to wire more conservation into the energy economy is to raise Corporate Average Fuel Economy (CAFE) standards and build more fuel-efficient cars.
We can do it. We have the technology.
Fortunately, it looks as if long-standing resistance in Congress to raising fuel economy standards is ebbing. The House and Senate are negotiating the details of the big energy bill that passed the House on December 6, but its likely that the CAFE increase in the House legislation will make the cut.
Good. Lets pour ourselves a big steaming cup of CAFE and toss it in Putins face.
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