If the United States government allowed the exportation oil and natural gas to any and all countries what impact could this have on the U.S. trade deficit? If the government lifted the policies what would be the positive and negative impacts? The U.S. has consistently been experiencing a trade deficit since the late 1990s with no signals or indications that we will reach a trade balance. Energy, particularly oil and gas, has been the one of fastest leading export for the United States since the shale boom of late 2009 “. Fortunately oil and gas is a resource that the U.S. has in abundance and holds a demand worldwide, yet the United States has a 38 year old policy that bans exporting oil and gas to any and all countries.
The policies to ban exporting oil and gas started in the early 70’s due to the 1973 Oil Embargo that crippled the U.S. economy and opened our eyes to our reliance of oil and gas from countries that do not hold our best interest in mind. In 1973 Egypt and Syria tried to win back a territory lost to Israel in 1967 during a conflict between the Arabs and Israel known has the Arab/Israeli War. Moving forward to 1973 on Yom Kippur, a Jewish holiday, Egypt and Syria invaded Israel to try to reclaim the lost territory again but where not able to overcome the Israel army. The United States helped supply Israel with reinforcement, in the eyes of the Arabic nation’s support our Israeli ally was not considered highly. Many of the unhappy Arabic nations where members of OPEC and decided to create an oil embargo against the United States, the largest consumer of oil and gas. The embargo had a created an “oil shock” crippling the U.S. economy, oil supplies where low, inflation began to increase, and the U.S. econ...
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...y dangerous and difficult job, harnessing the earth using man made products and the labor of humans as proven to result in negative environmental issues and disasters. Depending upon what you value highest deems what political line you approach with the oil and gas industry.
The cost benefits of releasing the Acts could produce many positive and negative benefits but the definitive outcome has yet to establish an amenable conclusion. Motivates and The U.S. would reap more benefit if the exports of oil and gas increased but ultimately the overwhelming personal views will mold our elected officials potential action or lack of action of exporting oil and gas. Unfortunately I highly doubt the U.S. will ever remove the bans because it has taken our elected officials over five years to decide whether the TransCanada Pipeline should pass through Western Nebraska.
After that global oil consumption increased and oil became the main source of energy for many countries. The United States government remained very involved in the relations for the oil industry because of its increasing importance to the global economy and its incredible conversion into international power. Foreign policy reflected their interest in the quest for oil and continues even today.
Between the years of 1983 and 1986, the United States was involved in a series of covert operations, collectively known as the Iran-Contra Affair. These operations were at best controversial, and at worst blatantly illegal.The Iran-Contra Affair (or the Iran Contra-Scandal) revolved around the issue of foreign policy, specifically with regards to Iran and Nicaragua. In 1979, revolution in Iran resulted in a complete change in the countries relationship with the United States. Having previously been an ally of the U.S., Iran, under its new regime, had become decidedly anti-American. These changes caused a time period of unrest that lasted into the mid 1980’s between the U.S. and Iran. Stabilizing the situation in Iran was one of the key objectives that motivated many of the authorities who were ultimately responsible for the Iran-Contra Affair. In 1985, seven hostages were taken by a terrorist group in Lebanon. This terrorist group had ties with Iran. Therefore, when Iran requested that the United States sell arms to them, President Reagan saw it as a potential way of getting the hostages returned. President Reagan wanted to see them returned safely, and hoped to restore good relations between the U.S. and Iran in the process. Many members of Congress were strongly against the idea. To go through with the arms deal was in direct violation of several laws, including policies against selling arms to entities on lists of terrorists countries, or terrorist-friendly countries, (Iran was included on such lists). Additionally, in negotiating with Iran, the Reagan administration would be dealing with known “terrorists,” something Reagan was openly very against. Nevertheless, the Reagan administration granted the Iranian’s request, in spit...
In Iran, Carter was ineffective in procuring a quick solution and as a result lost public support. While Carter was successful in dealing with the Israeli-Arab conflict, he was disastrous in his domestic economic policy and his other foreign diplomatic endeavors; ultimately his successes paled in comparison to his failures. Carter’s main attempt to resolve the energy crisis came in the form of a national energy program that moved to conserve oil and promote alternative energy sources like coal and renewable energy sources. The President convinced Congress to form the Department of Energy, and pleaded with Americans to control their energy consumption. Oil companies, however, insisted on more deregulation of the energy industry.
Oil has always been a coveted natural resource. Oil was discovered in the United States in 1859; since it was a young industry, it was without any structure. That is where John Davison Rockefeller stepped in. John Rockefeller was at one point one of the richest men in the world, monopolizing the oil industry which played a major role in shaping the economy.
foreign oil is damaging the energy industry in America as well as decreasing the amount
Aside from national security interests domestic thirst for oil boomed. The war brought us out of the Great Depression. During the Depression a traditionally capitalist American society embraced a kind of socialism with the New Deal. WWII transformed the bear turned in a raging bull. Capitalism was back with a vengeance, charging forward stronger than it had ever been before. The heavy industry built up to sustain the war effort was retooled to meet the demands of the emerging consumerist culture of the 1950s. The new explosion of industrial output became so pervasive that the decade ended with President Eisenhower warning of the dangers of the growing “Military-Industrial Complex.”
The United States has had several scares throughout its history in terms of oil, most turn out to be over exaggerations of a small event. However, these scares highlight a massive issue with the U.S. and that issue is the U.S.’s dependence on foreign oil. Why does it matter that our oil should come from over seas? In a healthy economy this probably wouldn’t be as relevant, but the U.S.’s economy is not exactly healthy at the moment. There are 4 things that I would like to address: what the problem is, how it affects us, what some solutions are, and what solutions I feel are best.
The late 20th century was a very turbulent time in American history. In 1976, Jimmy Carter was elected to the presidency, and he had many goals to help better America. However, on November 4th, 1979, a group of radical students seized the United States’ embassy in Tehran, Iran. This completely altered the course of American history and relations with the Middle East. This crisis had many impacts on the United States. It caused the Energy Crisis which in turn caused the Recession of 1979. The Iran Hostage Crisis also had political consequences for President Carter. It was a major factor that contributed to him losing the election of 1980 to Ronald Reagan. Additionally, this crisis led to many instances of racial discrimination toward Iranian-Americans and Iranian immigrants. Even after the Hostage Crisis was resolved, the bad blood between the two countries continued; the United States helped Iraq in the war against Iran, and the Iranians backed a second hostage situation in Lebanon. The Iran Hostage Crisis was a very important event that impacted America in many ways and destroyed our relationship with Iran. The consequences of this event are still felt today and continue to our foreign policies toward Iran.
For example, Hydrofracking; What is hydrofracking? Gas industries use hydrofracking to extract natural gases from shale ground in order to power Americans homes. When gas industries hydrofrack, they dig ten-thousand feet into the mantle of the earth and turn perpendicular to the t into shale layers with cement and steel casing to prevent leaks. Then rupture the layer of sediment with high pressures of water, sand and a plethora of chemicals. Once the chemicals are saturated in the crevices of the drill site, they extract the excess fluid and then ship them to market.
Fossil fuels have been proven to be damaging to our environment, economy and has made the United States vulnerable to dangerous and unstable countries by exporting the resources that they have. The U.S. depends on countries like Sadie Arabia for our oil supplies. How would we be affected if Sadie Arabia refused to sell us their oil? Would our oil reserves run out or would we be able to buy from another country? These are scenarios that we need to be concerned about. According to Rebecca Lefton and Daniel J. Weiss in their article “Oil Dependence Is a Dangerous Habit”, the U.S. has increased import of oil in the recent years, creating a bigger deficit in the United States. Our countries deficit has resulted in nationwide budget cuts. The continuation of oil imports with foreign countries is going to create an even larger debt in America. In 2008 our country spent around $150 Billion on oil imports alone (Lefton, R. & Weiss, D.J. (2014) Oil Dependence Is a Dangerous Habit. Retrieved from http://www.americanprogress.org/issues/green/report/2010/01/13/7200/oil-dependence-is-a-dangerous-habit/). Environmentally, the burning of fossil fuels have led to global warming. As most of us know, global warming can cause changes in our clim...
The U.S. trade deficit has risen more or less steadily since 1992. In the second quarter of 2004, the trade deficit relative to GDP surpassed the 5 percent mark for the first time. Many economists already considered trade deficits above 4 percent of GDP dangerously high. The fear is that continued growth in this external imbalance of the U.S. economy will ultimately spook overseas investors. http://www.americanprogress.org/issues/2004/09/b193700.html
...es currently does possess an enormous trade deficit, but the importance of this problem and the best means of solving it is a sharply debated issue. Clearly, while a return to protectionist policy would have some positive effects in the short run, it ultimately would undue the enormous growth that free international trade has caused for the US economy. The more moderate approach, of increasing domestic capital, reducing reliance upon foreign money and goods, and reducing government spending, deals with the situation much more effectively. A deficit is often times natural, especially in a wealthy country with a very strong economy, such as the US. Using these techniques, the negative aspects of the deficit can be overcome, while still ensuring the efficiency and affectivity of a liberal international trade system.
The embargo both banned petroleum exports to the targeted nations and reduced in oil production. So regardless of profit or loss factors of production, which does not affect in the short term, when oil prices was more than double (50 dollars) will cause the importing countries suffer from economic recession. If we look under the long term, we may wonders that to what extent the oil prices can rise and fall. Indeed, in the past crude oil prices fell below 20 dollars a barrel and then rising up to nearly 140 dollars a barrel as we have seen in the middle 2008. When looking in the long term, we may wonder where the peak and the trough of crude oil price is.
This rise in prices was real problem for the United States because they had no spare production to make up for the lack of Arab oil. Inside the U.S., the public suffered greatly because of the popularity of suburbia which in turn created a large dependency on oil to go anywhere. Therefore, the OPEC shock was detrimental to the life of the American citizen during its duration. People became very aware of the importance of oil, its price, and its availability. Thus there became an especially strong political pressure on companies, which promoted “equal suffering” and “fair share” principles to promote diversion. The king of Iran came up with a new basis for oil prices and it won app...
...n. "Twenty Years after the Embargo US Oil Import Dependence and How It Can Be Reduced." Energy Policy 22.6 (1994): 471-85. Print.