Rush Limbaugh

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RUSH: I found something yesterday I want to share with you. This $700 billion dollars a year we’re spending on oil, folks, I can’t tell you how much it tees me off, because it’s being portrayed as though we’re being extorted, blackmailed, we’re giving money away to terrorists and so forth. There’s a website called Seeking Alpha is what it actually is, and they start out quoting T. Boone Pickens. Mark Perry is the author of this little blurb. ‘As imports grow and world prices rise, the amount of money we send to foreign nations every year is soaring. At current oil prices, we will send $700 billion dollars out of the country this year alone — that’s four times the annual cost of the Iraq war. Projected over the next 10 years the cost will be $10 trillion — it will be the greatest transfer of wealth in the history of mankind.’ It’s no such thing. See, may I interrupt Mr. Perry here for a second. This is what bothers me. T. Boone, he knows better than this. He knows this is not a transfer of wealth. A transfer of wealth is taxing producers, taking it away from them and giving it to non-producers. Transfers of wealth are things like the estate tax when the money you take from somebody doesn’t redound to them in any way, shape, manner, or form. But this purchase of oil every year from foreign sources is not a transfer of wealth. It is an exchange of wealth.

‘Foreign oil producers like Canada, Saudi Arabia, Mexico (top three countries for US imports) send us their oil, and we send them ‘green pieces of paper with dead presidents’ pictures,’ aka as USDs. That imported oil helps to fuel our economy, cars and factories, raising our standard of living.’ There’s no transfer of wealth here. T. Boone needs to be ashamed, he’s smarter than this. This is an exchange of wealth. That $700 billion he is looking at in a totally incorrect way. ‘Oil producers in Canada, Saudi Arabia and Mexico now have US dollars, which must be spent back in the US on American goods and services, or invested in the US financial markets, either by the oil producers, or by those who buy the USDs from them. Importing oil certainly involves a transfer, but it’s not a transfer of wealth, it’s a market transaction involving the exchange of oil for currency.’ It is a wealth exchange, or transfer. ‘In T. Boone Pickens’ version, it seems like wealth gets transferred overseas without any benefit to the US. But oil imports, like all trade, involves mutually beneficial exchange. Remember trade is win-win, not win-lose (like T. Boone Pickens suggests), or lose-lose (the way the Soviets supposedly described a market exchange — buyers lose their money, and sellers lose their goods),’ but the state gets rich.

‘One dictionary definition of ‘wealth’ is ‘an abundance of valuable resources.’ In that case, wouldn’t T. Boone Pickens’ ‘greatest transfer of wealth in the history of mankind’ be a transfer of wealth in the form of valuable natural resources (oil) TO the United States, and not a transfer of wealth FROM the United States in the form of paper currency?’ Now, we can debate the dependency aspect of this, but that’s a different argument. This figure being bandied about, $700 billion is made and is described in such a way as to make us look helpless, as though we’re being shafted, as though we are being screwed. Yet what we do with that oil that we buy increases lifestyles, expands opportunity, grows the United States economy, creates jobs, enables us to move around when we want to go where we want to go, you know, within limits. If we didn’t buy that oil and we didn’t spend the 700 billion a year, where would we be? There would be a lot more than 400 airplanes parked. There would be a lot more automobiles on the unsold portion of the used car lots. And, by the way, who’s spending the 700 billion? We’re supposed to infer that the US government is being held up, that the sheiks are holding a gun to our heads and they’re making us pay this 700 billion, they send it on to Bin Laden, that’s what they want you to believe. But the government is not buying it all. They buy from the strategic reserve, but who do you think is buying this oil? Hmm?

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