What is it with Democrats and oil? Do they think “There Will Be Blood” is an accurate accounting of current oil company management practices?

Or did they fall for the “Iraq was a war for oil” fantasy and become convinced that we don't need to drill here anymore, since the Iraqis will be shipping us all their oil as a token of their esteem.

I ask because last week Rep. Nick J. Rahall II (D–WVA) proposed to increase the royalties on federal oil and gas leases and reduce the length of the leases from ten years to five.

Here we have a perfect example of Democrat incentives for the private sector in practice. A majority of Americans strongly favor increased domestic drilling. I believe the technical term for this is “drill, baby, drill.” Even Democrats from Obama down to the lowliest bribe–taker in Chicago all talk about “energy independence.” So what does Rahall propose? Increase the cost of federal leases by 50 percent and cut the time you are allowed to produce in half.

This offer certainly won’t result in a Black Friday at Wal–Mart moment. No one will be trampled in the rush to take advantage of those new terms.

Oil is one of the most expensive crapshoots in the country. Oil exploration involves hitting a lot of “dusters,” meaning the only thing you pull out of the hole is rocks and dirt. When you do hit oil, the producing well has to pay for itself and all the other wells that were dry holes. (Why does that phrase bring Congress to mind?)

Since, in spite of Congressional beliefs otherwise, oil producers are not able to manipulate the cost of oil at will, the longer a company has exclusive rights to a lease, the longer they have to pay off the initial drilling costs.

Reducing that time by half makes speculative drilling much less attractive and serves to inhibit new domestic production.

Yet, come election time, Democrat incumbents will hail this latest blow to domestic production as a “reform” of federal oil and gas lease policy. These economic illiterates will fill the airwaves with brag and boast commercials that you will be unable to avoid watching, because by that time you can’t afford to buy gas to escape the house.

My prediction is come next year or so, their “reform” and ten bucks will buy you a gallon of gas.

Michael R. Shannon is a public relations and advertising consultant with corporate, government and political experience around the globe. He is a dynamic, entertaining and funny keynote speaker for corporate, non–profit and governmental organizations.