Blaming Anyone but Himself

                A commentary

                By J. F. Kelly, Jr.

                In a recent letter to seven major U. S. oil companies, President Joe Biden wrote, “There is no question Vladimir Putin is principally responsible for the intense financial pain the American people and their families are bearing.” Well actually, Mr. President, there is some question as to responsibility. Much of that pain Americans are experiencing is a result of skyrocketing gasoline prices and they were rising rapidly well before Putin launched his war on Ukraine. And the reason they were rising had much more to do with your own war on fossil fuels than on the threat of Putin’s war.

                Biden’s war on fossil fuels included restrictions on fracking, pipeline construction, drilling on public lands and failing to remove permitting and environmental impact restrictions on the construction of more needed processing and export facilities. He assumed office promising to cut U. S. greenhouse gas emissions to half of 2005 levels by 2030. On his very first day in office, he blocked completion of the Keystone XL oil pipeline needed to carry Canadian crude to U.S. refineries and froze new oil and gas leases on federal lands.

                Oil is a major industry, crucial to our economy and to our energy independence. Fracking, horizontal drilling and other extraction technology has enabled our country to become the world’s largest energy producer and has the potential to enable us to become the world’s largest processor and exporter of liquified natural gas (LNG). LNG has done more to reduce carbon emissions than all the world’s windmills and solar panels. We lack sufficient processing and export facilities, however, to fully realize that potential or to more effectively alleviate Europe’s reliance on Russian oil and gas. Construction of these facilities is expensive and lengthy and industry leaders may be reluctant to take the financial risks involved when the government, influenced by climate warriors like John Kerry and other progressive leaders, seems dedicated to putting them out of business.

                Oil companies, like other investor-owned, for-profit organizations are in business to make money. While they have a moral responsibility to be good corporate citizens, pay taxes and obey the laws, they are not agents of the government, or responsible for solving the administration’s problems arising from its own bad policies. Investment in major projects to increase production will not necessarily result in lower prices and, in any event, is a business decision that needs to be based on some degree of confidence that the government doesn’t intend to shut you down before realize any return on that investment. Business decisionmakers hate uncertainty. Who can blame them?

                In his letter, the president appealed to patriotism, writing that “at a time of war, refinery profit margins well above normal being passed directly onto Americans is unacceptable.” But the United States is not at war, thank God, and these are not normal times. Surely, the president has noticed that the price of almost everything is well above normal, too. And while some of that is certainly a result of supply chain issues and transportation expenses due to Putin’s war and to increased Post-Covid demand, a lot more of the inflation we are experiencing is a result of prolific, trillion-dollar Covid relief spending. The appeal to patriotism, moreover, may be somewhat puzzling to Americans who are feeling the pain of having to decide whether to buy gas or fuel. Americans and businesses willingly suffered gas rationing and product shortages during WW-II but probably wonder why they are being told that the reason they are paying over six bucks a gallon for gas is because of a war halfway around the world away in Ukraine.

                The president knows, or should know, that oil producers have very limited control over the pricing of oil products. Oil is a global commodity and is priced largely according to demand, processing requirements and transportation costs. The Brent oil benchmark is used to price over three-quarters of the world’s traded oil. It’s based on factors like access to global shipping, risks in transit, port facilities and fees and storage capacity. Over 600 oil products are involved in the complex Brent index. Traders use it to attempt to accurately reflect global supply and demand and to minimize impact from speculation. Participants in the process include not only producers, but refiners, customers and traders who buy and sell oil futures.

                Not all of domestic production is available for domestic use. As a global commodity, much of it will find foreign buyers willing to pay whatever it takes. That’s just the way it works. Mr. Biden now finds himself in a bind that he helped create by surrendering to the progressive wing of his party and the climate warriors who are determined that all fossil fuel is evil and must remain in the ground, no matter what the cost, inconvenience or harm to people. Because of increased reliance on unreliable renewable energy sources, expect outages this summer and even more price increases for heating fuels come winter. He is in the embarrassing position of having to plead with Middle-East producers to ramp up their production in hopes of easing pressure on our gas prices and now he demands that the U. S. producers he regularly demonizes lower their profits even as his administration seeks to put them out of business. Mr. Biden has a habit of blaming others for the consequences of his own policy failures.

Oh, and by the way, the war in Ukraine is not significantly reducing the global supply of oil, just its distribution. Russian oil and gas are still finding eager markets, raising the question of whom his sanctions are harming most.

June 26, 2022

Freedom of Navigation

                A commentary

                By J. F. Kelly, Jr.

                China’s Minister of Defense, Wei Fenghe, recently reiterated, in the strongest of language, China’s willingness to fight to prevent any move toward Taiwan’s independence. Speaking at the Institute of Strategic Studies Shangri-La Dialogue in Singapore to a major gathering of Asia’s defense chiefs, he warned that “(i)f anyone dares to secede Taiwan from China, we will not hesitate to fight. We will fight at all costs. And we will fight to the very end.” He then added, “This is the only choice for China.”

                Well, not really. Another choice for a peace-loving world power, the world’s second largest economy and most populous nation with plenty of territory of its own, would be to allow the people of Taiwan a choice as to whether they wish to remain independent with a democratically-elected government or to live under the rule of the Chinese Communist party. It would accept the right of free people to chose their own leaders and for the self-governing island, known formally as the Republic of China (ROC) and which has never been under Communist rule, to live in peace as a neighbor and trading partner.

                By affirming in no uncertain terms Beijing’s intention of fighting to the end, no matter what the cost, to prevent that from happening, the People’s Republic of China (PRC) is making its intentions regarding the future of Taiwan crystal clear as opposed to Washington’s policy of strategic ambiguity which, hopefully, is not another name for no policy at all. It was disappointing to hear U.S. Defense Secretary Lloyd Austin state at the same conference that the United States does not support Independence for Taiwan. That may be official policy, but the United States has traditionally championed the right of people to chose their leaders democratically. It has, for example, granted independence to its former territory, now the Republic of the Philippines, and offered that option also to Puerto Rico. It also returned the Panama Canal Zone to Panama.

                Mr. Austin did criticize the PRC for its recent aggressive behavior and assured the attendees that America did not seek conflict in the region or a new cold war. Neither do we seek, he said, the creation of an “Asian NATO or a region split by hostile blocs”. Charges of aggressive behavior provoked a strong reaction from the PRC’s Mr. Wei who strongly rejected the American complaints about China’s actions in the region and said that it was the United States that was pushing for confrontation and seeking to encircle China. Given the shrinking size of our navy, one wonders what we would use to encircle China, even if that was our intention.

                Speaking of aggressive behavior, Chinese officials have recently asserted that the Taiwan Strait is not international waters, contrary to the U.S. interpretation of international law and the long-established right of innocent passage, even by warships, so long as they do not loiter or conduct military operations while transiting. The U.S. and other nations frequently send naval vessels through the straits as part of freedom of navigation (FON) exercises which invariably draw PRC warnings. These assertions by Beijing are reportedly causing concerns in the Biden Administration. They should. We need to be prepared for whatever may become necessary to defend freedom of navigation and protect maritime commerce in the Western Pacific and elsewhere. Our economy depends on it.

The Biden Administration needs to wake up to the fact that China’s increasing aggression, trade policies, expanding global influence and presence and militarization of the South China Sea, through which over half of the world’s seaborne cargo passes daily, is an existential threat to America as an Indo-Pacific power with far-flung vital interests that requires a very large navy to protect. Ours is simply not of sufficient size for that mission and we need to get busy with the lengthy and expensive process of building it up. That will require expanding our industrial base to be able to build more and better ships. To paraphrase Amity Police Chief Martin Brody’s classic line in “Jaws”, “We’re gonna need a bigger fleet.”

Taiwan’s government also agrees that the Taiwan Strait separating the island from the mainland is an international waterway and supports our navy’s FON transits. Taipei rebuffs the PRC claims of sovereignty over the strait which Its Foreign Ministry spokesperson, Joanne Ou, described as a “fallacy.”

                With inflation raging and consumer confidence fading, we are almost certainly heading for a recession. For those few of us old enough to remember the hard times of the Great Depression, we recall the hollow military that resulted from insufficient funding and neglect even as the storm clouds of war gathered. We also recall that it was the resultant mobilization for WW-II that not only enabled the allied powers to prevail but also lifted the country from the depths of the Great Depression. That’s not a reason for promoting war, of course, but rebuilding our military, and especially the navy, is not only essential for our future if we wish to remain a 3-ocean power, but would require the restoration of our industrial base which would be very good indeed for the economy.

June 21, 2022

The Future of Europe

                A commentary

                By J. F. Kelly, Jr.

                Vladimir Putin’s war in Ukraine, now in its third month, grinds on as wars often do without a clear end game. Denied the quick victory he expected, he has settled in for what will likely be a long, costly and bloody war of attrition which could last for many months or even several years. But not forever because, absent armed intervention by the West or regime change in Moscow, Ukraine cannot win a protracted war of attrition against its much-larger neighbor.

                Both sides have suffered heavy losses in lives and equipment. According to several news sources, Russia has lost more than 30,000 troops, over 1300 tanks, approximately 3300 armored vehicles, numerous pieces of artillery and at least 300 fixed and rotary wing aircraft. The war is costing the Russian economy dearly each day but Putin is willing to pay whatever it takes to stay in power which means he must win something or keep fighting because his power and perhaps his life would end if he loses. So far, he still enjoys the support of the long-suffering Russian people who have been conditioned over the years to endure hardship for the sake, they are told, of their country. And Putin’s brutal war is still being financed by sales of its abundant oil and gas which still finds buyers in Asia, Africa and elsewhere in spite of sanctions.

                Ukraine, on the other hand, must rely on military equipment and supplies from western nations just to continue fighting, let alone win. The types of weapons the West provides, moreover, are limited by concerns that they might provoke Putin to escalate the conflict as he has threatened repeatedly to do. Ukrainian President Volodymyr Zelensky has pledged not to use these weapons against targets in Russia. Russia has been assured, therefore, that it can prosecute an offensive war without having to worry about defending its homeland while Ukraine is limited to just defending or reclaiming its own territory. Russia, the world’s largest nation in area, spans two continents, has the world’s largest nuclear arsenal and contains abundant natural resources including oil and gas. It can tolerate relatively heavy losses. The salient questions are, however, (1) How long can Ukraine continue to tolerate the carnage and destruction and (2) How long will western aid continue and will it be enough and in time to matter?

                The damage to Ukrainian cities and infrastructure is staggering. Who will pay the regularly-increasing cost of rebuilding the country? Nearly seven million Ukrainians have fled the country, according to the U.N. and that number is increasing rapidly. What will they return to if they return at all? By some estimates, the population has shrunk to about 30 million. There is a cost as well to the western world beyond just the expense of military and humanitarian supplies sent to Ukraine. The inability to export Ukrainian and Russian grain and fertilizer from blockaded Black Sea ports is resulting in serious food shortages, especially in Asia and the Middle East, which could precipitate unrest and riots. Sanctions on Russian oil and natural gas are contributing to huge increases in the cost of fuel and gasoline in Europe, America and elsewhere. President Joe Biden blames the high price of gasoline on the war in Ukraine rather than his own war on fossil fuels. The United States, once energy self-sufficient, is limited in how much it could help because of restrictions on drilling, pipeline construction and permits for building needed processing and export facilities. Thus, we have the spectacle of the president of the country with the world’s most abundant energy resources pleading with the Middle East oil producers to increase their production in order to ease our fuel prices.  

                In spite of heroic resistance on the part of brave Ukrainian fighters, the reality is that Putin appears to be slowly winning a war of attrition. His armies may have failed to take Kyiv and territory in the west but they have made substantial territorial gains in the east and south, including a much-desired land link to Crimea which they annexed in 2014. Zelensky’s goal of regaining Crimea and the Donbass region is unlikely to be achieved. As long as he lives, Putin will never agree to give up Crimea which was once part of Russia and contains the homeport for his Black Sea Fleet. It and the Donbass region contain many ethnic Russians, Russian-speakers and Russian sympathizers. Former U. S. Secretary of State Henry Kissinger recently suggested that the time may have come for negotiations to end this costly and brutal war while there is still enough of Ukraine left to save. How many more lives must be lost in search of an ideal solution that is not achievable?

                Supporters of Ukraine, and American is surely one of them, will argue that Russia cannot be trusted to negotiate in good faith. A negotiated peace will be fleeting, they say, and ceding any territory to Russia will only invite future aggression. Moscow should be warned, however, that this would most assuredly provoke an armed western response. So, realistically, what are the alternatives? Fighting until the last Ukrainian is left standing? Finally, there are risks in trying to marginalize Russia. The world’s largest country, a major military power and energy producer with a rich cultural heritage is not going away whatever the outcome of Putin’s stupid war and will always be an important part of Europe and Asia. Moreover, Putin won’t be around forever.

June 16, 2022

An Epidemic of Violence

                A commentary

                By J. F. Kelly, Jr.

As with most every other issue of critical importance, Americans can’t seem to agree on whom or what to blame for the epidemic of mass shootings, including school shootings that took the lives of innocent children who did nothing to hurt or offend anyone. And like most other emotional and contentious issues, it’s being shamelessly politicized. Those on the political left tend to blame the guns; those on the right, anything but the guns and particularly, mental illness. Mental illness is the new pandemic, some say. There are signs of it all around us, especially among the homeless populating the streets of our cities.

                We used to institutionalize the mentally ill and as long as they were out of sight, nobody except close relatives gave them much thought. That all changed about the time of the Reagan Administration when it became extremely difficult to institutionalize them against their will and we were essentially told to live with them among us because mental illness was just another illness. But it’s not just another illness. It’s often extremely difficult to determine reliably whether or not mentally-ill persons are a lethal threat to themselves or to others.

                And it’s far from clear that we are actually experiencing an epidemic of mental illness. We may just be more aware today of its prevalence among us. In any event, it’s a rush to judgement and too convenient to blame it for the rise in mass shootings. What seems abundantly clear, however, is that we are experiencing an epidemic of violence and those who act out violence, mostly young males, are probably not all mentally ill. We see violent behavior in public on a regular basis; on the streets and highways, at concerts and athletic events, in the stores and markets and almost anywhere that alcohol is sold. You witness, hear or read about young men who are much too easily offended and enraged, acting out their anger and showing little regard for human lives including those of innocent bystanders and their own.

                The statistics tell part but not all of the story because many, perhaps most, acts of violence are not even reported let alone prosecuted. We have become numb to violence. Homicides rose last year in almost every major city in America; in Philadelphia, Los Angeles and Houston by over 15% and in Indianapolis and Columbus by over 20%. Chicago, the murder capital of the U.S., leads the nation with 739 in the first eleven months of 2021. In twelve major cities in the U.S., homicide rates hit all-time highs. So, what do these cities have in common besides lots of funerals and grieving survivors? You know the answer. They are mostly run by Democrats and have prosecutors that don’t prosecute, de-criminalize serious offenses and release violent offenders to commit crimes again. There are, to be sure, socio-economic factors involved but they don’t excuse the fact that many of those elected to protect the public have failed miserably in their most important responsibility. They have, in fact, made matters worse by their soft-on-crime policies.

                With the massacre of two teachers and 19 children in Uvalde closely following the racially- motivated murder of ten Blacks in Buffalo, Americans are again demanding action but again, as in the past, agreement on what action to take is elusive. Please, candidates, spare us the simplistic campaign promises during the coming elections to get the guns off the streets. Guns don’t murder people any more than cars do. Murder requires intent. It’s the violent person who pulls the trigger or uses his car as a weapon that kills people. And we will never get all the guns off the street. There are more of them than there are people and violent people will always find a way to get them. Besides, we’ve ceded control of the streets in many areas to gangs and criminals. It’s a little late for major gun control legislation now that we’ve defunded and re-purposed many police departments. Therefore, law-abiding citizens will indeed cling to their guns ever more tightly because they now realize that demoralized, undermanned and demonized police have become overly-cautious and cannot possibly protect us from all the violence. After almost every mass shooting, the sale of guns and ammunition soars. Most people will do whatever it takes to protect their families.

                And then there’s the matter of the Second Amendment. Some members of Congress are responding to public demands for action by attempting to find some common ground for bi-partisan legislation but each side remains suspicious of the other side’s motives. Besides, gun control legislation is largely the responsibility of the states and they are very jealous of that responsibility. Guns are part of the culture in much of America, like it or not.

                And speaking of culture, there is an urgent need for a cultural transformation regarding our attitude toward violence, authority and parental responsibility. Where were the parents of those young mass murderers? Oh, right. The shooters came from broken or dysfunctional families. Too often there is no dad around to teach them responsible male adult behavior. We have another pandemic in this country and that’s a failure of parenting with too many kids being reared by a single mom, too busy earning a living to deal with a rebellious teen. There are too many being dumped on aging grandparents to raise. It’s such fun being a parent when the children are small, cute and adorable. Not so much when they become big, sullen and rebellious. A parent’s assertion that they can no longer control a child does not relieve them of responsibility. We also have an epidemic of disrespect for authority and especially for the police. What gives young men the idea that they can resist arrest or try to evade police or engage in road rage or ignore laws? That has to change.

                Would I be in favor of limiting gun ownership to persons 21 or older? Absolutely. Brains are not fully developed in persons under 21, especially the functions having to do with restraint and judgement. Yes, I know they’re old enough to go to war but fighting is something they tend to do well; anger management, not so much. And they are carefully screened, trained and supervised before they are even allowed to handle a military firearm.

June 10, 2022

Time to Clarify Strategic Ambiguity

                A commentary

                By J. F. Kelly, Jr.

                There he goes again. For the third time, President Joe Biden has called into question, wittingly or unwittingly, his country’s policy of strategic ambiguity regarding what its response would be should the People’s Republic of China (PRC) attempt to take control of Taiwan by force or coercion. In response to a question during his recent trip to Japan as to whether the United States would respond militarily to defend Taiwan, he answered, “Yes. That’s the commitment we made.”

                Well, not really. So once again the president’s unelected advisors had to explain what the president really meant. There is no change in the U.S. policy regarding Taiwan’s defense, they said. Maybe not, but that was a pretty emphatic “yes” that came out of the president’s mouth. Maybe this time he actually meant what he said. If so, that sure sounds like a major policy change with huge ramifications. Beijing’s communist leaders reacted like they thought he meant it. So did Taiwan’s foreign ministry which reacted warmly to the words. Japan’s Prime Minister, who was present, added that his government is against any unilateral attempt to change the status quo in Asia. A PRC invasion of Taiwan would certainly change the status quo.

                White House officials assigned the challenging task of interpreting Mr. Biden’s words later said he merely reiterated our commitment under the Taiwan Relations Act to provide Taiwan with the military means it needs to defend itself. That’s usually thought to mean weapons and other supplies but “military means” could mean just about anything. The act is silent on whether or not we would actively engage the PRC if it invaded Taiwan. The wording of the act doesn’t make our policy particularly clear but perhaps he should carry copies of it with him to refer to the next time he’s asked.

                In 1979, the Jimmy Carter Administration stated that the government of the People’s Republic of China was the sole legal government of China. It ranked, in my opinion, among the worst of many bad decisions the hapless Carter Administration made. It ceased to recognize our long-standing ally, the Republic of China (ROK) which ruled Taiwan, acknowledging, but notably not endorsing, the PRC’s position that Taiwan was part of China. The PRC attempted to substitute the word “recognize” for “acknowledge” but the State Department prevailed, on this matter at least, insisting on “acknowledge” remaining in the text of the U.S.-China Communique that ended our support of the two-Chinas policy.

                After the Carter Administration recognized the PRC, the U.S. Congress passed the Taiwan Relations Act which was intended to protect our security and commercial interests in Taiwan. It provided for continued informal relations with Taiwan even in the absence of diplomatic relations and stated our commitments regarding Taiwan’s security. In the event of any threat to Taiwan, the U.S. president was to consult with Congress regarding an appropriate response. Thus was born the policy known as strategic ambiguity.

                Since then, the U.S. position has been repeatedly re-stated but not really clarified. It states that Taiwan’s future will be determined by peaceful means and not by force or coercion. Any resort to force would mandate that the U.S. would provide defensive weapons to Taiwan and maintain the capacity to resist such use of force that would jeopardize the security or economy of its people.

                Our commercial and security interests in a free and independent Taiwan are substantial and so are those of other free nations of Asia including Japan which ruled the island for half a century after it was ceded to them by China. Taiwan is the world’s 18^th largest economy, our ninth-largest trading partner, a major manufacturer of microprocessors and a major shipping and ship-building nation. It is a prosperous, democratic, industrialized powerhouse of over 23 and a half million people. It has never been under communist rule and its people show little desire to start doing so. It has all the attributes and institutions of a strong and stable independent country and member of the world community.

                Diplomats may prefer vague language and strategic ambiguity in policy documents but military planners usually need more specific language given the long lead times involved in ramping up military and industrial capability and capacity. If Mr. Biden is signaling our intentions to actually do whatever it takes to defend Taiwan, then he needs to understand that we will need a much, much larger military and especially a larger navy, whatever the cost and even with the full support of an alliance including Japan, South Korea, the U.K, Australia, New Zealand and anyone else who is willing to join. This will take time to ramp up and it is very late indeed. I doubt that China will wait until we are fully ready for whatever it takes to defend Taiwan and it will take a lot.

Meanwhile, the time to provide Taiwan with the means to defend itself before help arrives, if it ever does, is now, not when hostilities begin.

May 31, 2022