Sep

Why vote for Obama? A Debate

During convention breaks, I managed to get myself into a debate with a friend who I was very surprised to find out is an Obama supporter. I will not disclose who it is but feel free to throw in your comments as well. For context, it started with him sending out a picture of his Obama sign and then went into the email chain below. It’s rather informal but is an interesting look into differing opinions.

Obama Supporter: (Sends picture of his new sign)

Me: I love high taxes and and a lack of experience too! (Somewhat sarcastic but light hearted)

Obama Supporter: Those taxes won’t be higher for me – and I am a self-interested voter.

Also, I’m sold on the judgement vs. experience argument. Moreover, how can anyone really have the necessary experience to be president? What other job is close to it … ?

Me: What you are doing id like buying an adjustable rate mortgage, yes it’s cool now to have a rockstar president but when you make more money and he is taxing the heck out of you (like the adjustable rate on an ARM), it won’t seem so cool. Oh, and what about the capital gains taxes he wants to double, don’t you own stock? If you do, do you seriously think some else will cut it just in time for your retirement? I challenge you to think long term, big goverment vs small government, high taxes vs low. That is your real self interest.

Obama Supporter: You say double, I say return it to a normal rate. 25% sucks, but so does 15%. A responsible investor will be fine. For example, I can move to Colorado where the state income tax is half of what it is here in the midwest. Or I can stop paying a fee to my broker. I’m OK with a little pain the pocket book if it means we can right this ship. Sh*t, Warren Buffert knows it too

(http://www.guardian.co.uk/business/2007/oct/31/usnews). We can’t keep thinking that we can tax-cut our way out of problems … if that were true we wouldn’t be in this massive deficit. The current plan (the
republican plan) has netted me exactly zero – so let’s bring on something new.

Now, do I think democrats are our saviors … absolutely not. I just want a change to the status quo. I will always, always vote for the candidate best equipped to fix what is broken. Sometimes its a
democrat and sometimes its a republican. This time, Obama beats McCain on the ability to heal what ails us.

Me: What policy dies Obama espouse that will “cures what ails” us? He is expanding government programs and cutting nothing. I just can’t believe in “the one”, I haven’t seen a single policy I agree with.

Oh and of course Buffett agreed he already has his money and the cap gains increase plays right into his investment strategy.

McCain wants to shrink the government, Obama wants to grow it and stick with the status quo on social security and Medicare. McCain and Palin are for real change and smaller government, I will vote that way every time.

Obama Supporter: Sounds like dogma.

Give me some time to list all of Obama’s positions that I agree with and all of the McCain ones that I don’t. I might even learn something about myself in the process.

Here’s the start of the list:
1. Obama has an innovation plan (http://www.youtube.com/watch?v=m4yVlPqeZwo) and will appoint a federal “CIO” type of position vs. McCain who doesn’t use computers.

2. Obama has a more comprehensive and aggressive plan to get us off foreign oil vs. McCain who wants to focus on more drilling (which won’t give any benefit until 2030) -
http://www.eia.doe.gov/oiaf/aeo/otheranalysis/ongr.html

Me: There already is a CIO at the federal level , dig a little deeper that’s just lip service. Also, Obama doesn’t use a computer much at all, he is my dads age.

McCain has a diversfied energy plan that includes short term drilling and alternatives, 2030 is a liberal-touted estimate.

Obama Supporter: Right, the 2030 is an estimate but what about this concluding paragraph…

Although a significant volume of undiscovered, technically recoverable oil and natural gas resources is added in the OCS access case, conversion of those resources to production would require both time and money. In addition, the average field size in the Pacific and Atlantic regions tends to be smaller than the average in the Gulf of Mexico, implying that a significant portion of the additional resource would not be economically attractive to develop at the reference case prices.

The source is our own government agency – hard to argue with.

Me: “economically attractive to develop at the reference case prices.”

The data on oil field sizes for this report is 2003! Check the graphs to the right, and the report was released last year when oil was almost half the price it is today.

The prices have changed since the writing of the study, per barrel prices have sky rocketed. Besides, why not let the companies try? Good things happen when you give companies opportunity, they innovate. Government doesn’t innovate, it facilitates, small and large businesses have always been a better source of innovation. The government needs to get out of the way. It should be as small as possible, it is the problem, not the solution. (http://www.eia.doe.gov/oiaf/aeo/otheranalysis/ongr.html)

Obama Supporter: I think I linked to the wrong one; there’s a new report.

We can’t just rely on companies because they have an economic incentive to keep selling oil at the higher price – that’s markets 101. So what’s good for the companies is bad for us. When we get in these situations, we hope the innovators will solve the problem but they have been unable to. They’re on the cusp, but they need something to push them over the hump. I think its OK if government does that through incentives or by punishing the “bad” (i.e. taxes on emissions, ect…).

Me: ”We can’t just rely on companies because they have an economic incentive to keep selling oil at the higher price – that’s markets 101″

No, economics 101 is that competitive markets produce lower prices. By expanding our domestic production of oil we can compete with the Middle East and Russia better, decreasing prices as OPEC loses it’s ability to set prices. If your above stated theory held, Walmart would be charging what Sak’s Fifth Avenue does, they don’t. Why? Competition and strategy. Right now the government is impeding oil competition. If they got out of the way and let US companies drill we could compete and prices would fall as they have in every other industry.

I hate this idea of a “hump”, companies are trying as hard as they can to develop these alternative energy technologies with almost limitless funds from private investors because there is alot of money to be made. Look at Tesla Motors, GE, heck even Chevron is the number 1 producer of ethanol. The government will not help, they will only hinder, complicate and regulate. If there are ideas out there with potential, American investors will step up. They always have and always will.

Also, you didn’t send a link, the quote you used is from the 2003 data report finished in 2007, I was unable to find anything newer.

“ I think its OK if government does that through incentives or by punishing the “bad” (i.e. taxes on emissions, ect…).”

I guess I see that you are trying to internalize negative emissions externalities here through taxes. I disagree that the government is the proper vehiclfe for this. They have been taxing like this for years but it didn’t really change until people’s opinions changed. When “green” came “in”, emissions decreased much more significantly. Change people’s minds rather than trying to control them according to your beliefs through their pocketbooks.

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