3 Huge Recent Economic Developments You May Have Missed

Business news lately has been the same story over and over: The stock market is volatile, politicians hate each other, there aren't enough jobs, and Europe is a mess. Rinse. Repeat. Day after day.

But some really interesting developments have taken place recently, many of which haven't received enough attention. Here are three.

1. For the first time since 1949, the U.S. is a net fuel exporter
America has been marred with a poor energy policy for decades. The phrase "dependence on foreign oil" is ubiquitous. And make no mistake: We still rely heavily on foreign nations to feed our energy needs.

But measured one way -- imports and exports of petroleum products like gasoline, diesel, jet fuel, and propane -- the U.S. is actually now a net exporter for the first time in generations:

Source: Energy Information Agency.

In 2005, the U.S. imported 840 million more barrels of petroleum products than it exported. In 2011, it exported 27 million barrels more than it imported. This is an incredible turnaround that goes against so much conventional wisdom, yet it's received scant media attention.

What's behind the shift? Several things. For one, U.S. demand has declined for some petroleum products. U.S. drivers drove about 57 billion fewer miles in 2010 than in 2008, and average gas mileage rose to 23.8 miles per gallon in 2009 from 21.9 MPG in 2000, according to the Bureau of Transportation Statistics. Ethanol production is also surging, with capacity rising from 3.1 billion gallons a year in 2004 to 13.5 billion gallons a year in 2011.

At the same time, foreign demand for fuel products is rising. Argentina, Peru, Mexico, Brazil, the Netherlands, and Singapore are all now major net importers of U.S. fuel products. According to The Wall Street Journal, Singapore's net imports of U.S. fuel products have quadrupled since 2006, while Mexico's have risen by two-thirds.

This is far from saying the U.S. is energy independent. We still import roughly half the crude oil we use -- a reliance of about 9 million barrels a day. But even that figure has declined sharply in recent years. In 2005, we imported 60.3% of our oil. In 2010, that figure was 49.2%, and will likely drop further as domestic production in regions like North Dakota continue to surge.

2. Growth in health-care spending is near a record low
Health-care costs have ravaged household, business, and government budgets for decades. Along with education, health care is one area that has truly experienced extreme inflation over the last several decades.

But the growth rate of health-care spending is actually falling at a shocking rate. According to health policy journal Health Affairs, "The rates of health spending growth in 2009 and 2010 marked the two slowest rates in the 51-year history of the National Health Expenditure Accounts."

Here's how this looks over the last half-century:

Source: National Health Statistics Group.

Health-care spending is still growing, of course. It's just growing at a much slower rate than before. And note that this is health-care spending, not health-care prices. In many cases, health-care prices are rising rapidly (for both treatments and insurance premiums), but overall spending is growing at a slower rate because we're using less of it -- a fact some chalk up to the financial strains of the recession. One example: According to the Kaiser Family Foundation, 69% of businesses offered workers health insurance in 2000. By 2009, only 60% did.

One thing this chart gets me thinking about is whether we're overly worried about the rising cost of future health-care spending when forecasting the long-term federal budget. The variable that causes the budget deficit to balloon in coming decades is an assumption that health-care costs will rise precipitously. And maybe they will. But the sharp decline in health-care spending growth in recent years shows that health care is just like any other service: If it gets too expensive, we spend less on it.

It's interesting to ask what happens if growth in health-care spending comes in much lower than we now expect. A huge portion of future budget deficits could be wiped away. And given the track record of budget forecasts, it's quite likely that what's expected today won't happen tomorrow. (Of course, we could also ask what happens if growth is higher than currently anticipated.)

3. The biggest contributor to the budget deficit over the last decade wasn't stimulus spending, the Bush tax cuts, or two wars. It was tax evasion.

Last week, the IRS released a report on the estimated "tax gap," or money that people legally owe in taxes but evade paying.

For 2006 (the most recent year calculated), the gap stood at $450 billion, an increase from 2001's estimated tax gap of $345 billion.

Keep in mind, this isn't money people legally avoid paying by using tax shelters like an IRA or 401(k). This is tax revenue illegally unpaid thanks to things like offshore bank accounts and unreported cash receipts from businesses.

The IRS only issues these reports every five years, and each report details just one year. But let's use some assumptions. Assume 2001's tax gap of $345 billion was reflective of the 2001-2005 period, and 2006's $450 billion gap was reflective of the 2006-2011 period. In total, that's $4.4 trillion in lost tax revenue over the last decade.

Now, this is a rough estimate at best. I used the IRS' old data last year to estimate the decade's loss from tax evasion at $3 trillion. The real figure, which is almost impossible to know, is probably somewhere between $3 trillion and $5 trillion. Either way, what I wrote last year holds true:

Put that money in perspective. Tax evasion in the last decade cost an amount roughly equivalent to the Bush tax cuts, the Obama stimulus, and the wars in Iraq and Afghanistan... combined. It's amazing more people aren't outraged about this stuff. Rather, they likely would be if they knew about it.

As long as there are taxes, there will be tax evasion. It will never be eradicated. The question is whether the tax gap can reasonably be reduced from current levels.

If it can, we're not trying hard enough. As David Cay Johnston recently wrote in Reuters, the IRS' budget is being cut by 5%, which will likely increase tax evasion through fewer enforcement officers. He explained:

IRS data show that auditors assigned to the 14,000 or so largest corporations found $9,354 of additional tax owed for every hour spent testing tax returns in the 2009 fiscal year. The highest-paid IRS auditors make $71 an hour. Based on a 2,080-hour work year, that works out to around $19 million of lost revenue annually for every senior corporate auditor position cut from the payroll.

It's counterintuitive, but cutting the IRS' funding can be one of the fastest ways to increase the budget deficit.

What do you think about these numbers? Share your thoughts in the comments section below. And if you haven't already, check out my e-book, Everyone Believes It, Most Will Be Wrong, on Amazon.com for your Kindle or iPad.

Check back every Tuesday and Friday for Morgan Housel's columns on finance and economics.

Fool contributor Morgan Housel doesn't own shares of any of the companies mentioned in this article. Follow him on Twitter @TMFHousel. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On January 20, 2012, at 5:04 PM, DJDynamicNC wrote:

    Three items covered, and all three were news to me.

    Excellent article.

  • Report this Comment On January 20, 2012, at 5:31 PM, Rensir wrote:

    It just goes to show that conventional wisdom is just that convenient wisdom. Great article.

  • Report this Comment On January 20, 2012, at 6:48 PM, gkirkmf wrote:

    #1 caused by the great Bush Recession. Besides, Oil is a finite resource, no matter what wizard you may have consulted.The world will use 91 million barrels of oil per day in 2012. That is 1.5 million barrels a day more than last year. Supply will lag demand by that same 1.5 million barrels a day. And that is with no major oil corporation sponsored wars cropping up.

    #2 caused by the great Bush Recession.

    #3 Deliberately done by a congress devoted to the enrichment of the folks who have the flexibility to evade taxes via shaky legal and illegal scams. The poor working schmuck has no way of avoiding social security taxes and income taxes. Makes the plan to raise taxes on the top 1% problematical doesn't it.

  • Report this Comment On January 20, 2012, at 7:26 PM, Cedarjones wrote:

    Tax gap the cause of the deficits? If Fool writer Moran Housel continues to be fooled by this IRS propaganda, then I will stop reading anything by Morgan Housel. The Fool's editorial staff must be embarrassed that this one slipped past. Ok, it's Friday.

    The "tax gap" is nothing more than a mythical figure politicians use to justify new and burdensome compliance requirments. What about compliance costs? Does anyone think that number is outrageous?

    That's money in the private sector that could have been put to productive use. But no, it's spent pushing paper.

    A far better way to eliminate "tax gap" would be to reduce income taxes to the point where it is not worth it to evade or under-report. But no, writers like Housel provide encouragement for even more regulation and even BIGGER government than we already have.

    Housel, you just ruined my weekend.

  • Report this Comment On January 20, 2012, at 7:34 PM, xetn wrote:

    Morgan: Maybe this would be a better perspective on taxes:

    http://www.youtube.com/watch?feature=player_embedded&v=J...

  • Report this Comment On January 20, 2012, at 7:37 PM, clbjblk wrote:

    You have to look in the Obama theory he takes credit for Bin Laden when Clinton was looking at the memo under his desk and Bush set it up so it would be harder to get in US and Obama gets credit you would think he signed up for the family tree website but Kenya does not allow you to know your dad,just ask the Vice Pres Joey when he whispered in the Pres,s ear and said you better call Bush and thank him for doing the real work and you know what ,that is the only thing Obama did right he can't take credit for the 37 XMAS trees in the White HOUSE everybody knows there are 50 states right Jose can you see!

  • Report this Comment On January 20, 2012, at 8:43 PM, MrChapel wrote:

    I have to wonder about that estimated tax gap. To me, it seems they just pulled an arbitrary number out of their hat. Maybe using statistics but we all know that the same data, fed into statistics, will give you an infinite number of answers.

    Think about it. It is an estimation. If they really knew all the people who have offshore bank accounts, if they had proof, wouldn't the IRS invite them for a little chat?

    I have no doubt there is tax evasion. The problem is, it's a consequence of the tax code. Here in the Netherlands, even tax experts are stymied each year with the ever-changing rules. Publishers make a mint each year putting out tax help books for that year, including the correct forms on DVD. And out tax code is less convoluted than the US tax code.

    The solution is to completely overhaul the tax code so that it comprises maybe ten pages in letter format. Make it easy to understand, isn't that what that new government entity is for, the one that's supposed to make sure legal contracts from banks, credit card companies etc. are understandable for us poor, uneducated simpletons? I don't care if it's a flat tax, 9-9-9, VAT or throwing darts at a chart. Simplify it, cut it down and you'll be able to cut tax evasion down significantly.

  • Report this Comment On January 20, 2012, at 9:27 PM, TrumanTrout wrote:

    The idea of reducing tax evasion by simplifying the tax code strikes me as utter fantasy. One of the reasons that tax regulations are complicated is the necessity of keeping up with tax evasion schemes. The IRS can hardly compete with the private sector's ability to create "tax-advantaged" arrangements.

    Truman Trout

  • Report this Comment On January 20, 2012, at 9:34 PM, TMFTypeoh wrote:

    Morgan,

    Fantastic, as usual......

    Brian

  • Report this Comment On January 20, 2012, at 9:39 PM, ETFsRule wrote:

    Great article, thanks for the info.

  • Report this Comment On January 20, 2012, at 10:03 PM, mtngpa wrote:

    that is why we need a flat/user/consumption tax!

  • Report this Comment On January 20, 2012, at 10:31 PM, JGBFool wrote:

    Wouldn't a national consumption tax decrease consumer spending, and thus stifle economic growth?

  • Report this Comment On January 20, 2012, at 10:55 PM, BHOmustGO wrote:

    Regardless of how much of a "tax gap" they estimate, if all that money ended up in the fed's coffers, the politicians would spend all the money in their customary wasteful ways.

    The "tax gap" money gets put to use in the economy, so it is actually a stimulus. Isn't that how the libs (remember Pelosi's comments?) define unemployment checks? And how about the millions of homeowners who are not paying their mortgage and using the money for putting food on the table and providing for their families?

    So "tax evasion" really is a stimulus for the economy and serves a much better purpose than letting the slimy politicians fritter away the money.

  • Report this Comment On January 20, 2012, at 11:31 PM, bbell46356 wrote:

    I agree with the writer who stated at least part of the problem is the complexity of the tax code. It is something like 14 volumes. I have personal experience and consider myself a pretty smart guy, but if you have to spend 30 or 40 hours trying to figure out how to file for just one tax credit, when your accountant nor the IRS support people can give you a straight answer, then no matter what you do, you might be a tax evader.

    If you don't believe it, try looking at the tax credits for Research and Development, the small business health care credit or better yet, try doing your kids tax return if they are under 18 and have investment income.

    This is not limited to just taxes. The laws are so complex that anybody probably breaks several laws everyday without knowing it.

  • Report this Comment On January 21, 2012, at 12:06 AM, wan2bretired wrote:

    Health care ..." If it gets too expensive, we spend less on it."

    High unemployment, high deductibles and future uncertainty equates to fewer elective procedures and testing. In WA state medicaid has stopped payments to physicians for services already rendered. Many have stopped seeing new medicaid patients thus less spending. Statistics are like art ... we all see something different.

  • Report this Comment On January 21, 2012, at 3:49 AM, PeakOilBill wrote:

    Tax collectors are the best investment the US government could EVER make. The reason it doesn't happen is because the very wealthy are the biggest offenders and political contributors. I watched a Frontline special about the tax evasion of the very rich about 15 years ago. I never knew that many had full time tax lawyers that did nothing but develop new ways to confuse the tax authorities with complex new tax avoidance schemes. IF audited, they threaten to go to tax court and the government settles for a fraction of the tax actually owed rather than being tied up in court for years. It probably demonstrates the need for a simple progressive tax code.

  • Report this Comment On January 21, 2012, at 4:27 AM, seattle1115 wrote:

    Another excellent article - thank you.

  • Report this Comment On January 21, 2012, at 8:25 AM, AMDGTT wrote:

    A thought provoking article, as is evident from the above comments. On the healthcare spending piece, while I understand wan2bretired's comment that the figure can be attributed to trends other than (solely) consumer-motivated choice, I would hope that at a minimum the recent economic downturn causes consumers of health care to become more thoughtful of their consumption. I suspect that many physicians have been forced to practice litigious medicine, and we can all play a role in making the right choices for our required level of care (and therefore expense) by questioning cost,benefit and alternative, rather than simply blindly following doctor's orders.

  • Report this Comment On January 21, 2012, at 9:07 AM, JacksonInVA wrote:

    Great news. Great reporting. Motley Fool tops any news-only company for quality articles that make a difference.

  • Report this Comment On January 21, 2012, at 9:42 AM, kabrink wrote:

    Tired of people liked gkirkmf. The recession is more properly known as The Great Barney Frank recession. The Democrats previously have whined and lambasted lenders for years and years that they didn't loan enough money to "the poor, or minorities, or whomever other of their assumed constituents". Of course. The banks were smart enough to review and test applicants ability to pay back. But, they finally found a way to meet the Democrat demands and loan money to anyone under the sun without checking their financial status. After they figured they could spread and shed the risk they went to town. Also, Republicans tried to shut this all down by neutering Fannie and Freddie, but no, the Dems didn't want to and prevented it. Barney Frank said that "we should gamble on this housing thing some more". And that's all there was to it.

  • Report this Comment On January 21, 2012, at 10:10 AM, TMFGortok wrote:

    The article doesn't go into why capital flight occurs. Capital flight occurs because taxes that are too high. Money goes to where it gets the greatest rate of return, and trying to work against that economic principle is foolish (with a lower case 'f').

    Let's say that tomorrow the IRS was granted the powers to arrest, and their enforcement grew to be on par with police powers and strength in the 'War on Drugs' (we could even give this project a 'war' name, like the War on Tax Evasion).

    What do you think would happen? Would everyone magically pay their taxes? Or would we have an outcome similar to the drug war? Where the rich still get off scot-free, and the middle class loses.

    As the risk of being cast aside because I brought up Rand, I wouldn't be surprised if the rich took their money and went elsewhere, leaving us in the same (or an even worse) predicament we're in now.

    We tax too much, and we spend too much. We don't have a revenue problem, we have a spending problem.

    As a recent video so eloquently illustrated ( http://www.youtube.com/watch?feature=player_embedded&v=J... ), we can even tax income at 100% over 250,000 and still not balance the budget for 1 year. 1 year!

    If the Federal government stayed within its Constitutional bounds, we would not have a federal budget crisis. And if the states really wanted to provide these services that are 'so crucial', then they would be forced to balance their own budgets and people would have a much greater say in what happened to their money.

  • Report this Comment On January 21, 2012, at 11:23 AM, azmfool wrote:

    I don't get these boards anymore. This used to be a good environment for discussion between people of basic intellect and a common interest. Anymore, we get vitriolic, unfounded, sometimes flat-out dumb, if not impassioned comments. I sometimes wonder if these are true Fool community members, or just people who clicked a link on the Vine or MSN. Sorry, I'm crabby this morning.

  • Report this Comment On January 21, 2012, at 11:35 AM, wan2bretired wrote:

    I agree with TmfGortox ...

    In health care the gov has played an integral role in the cost stucture and manpower ( mainly physicians) since the '60s. LASIK surgery is not a covered health benefit. Once out of reach due to cost, is now affordable to the masses. This is competition without government involvement.

    To amdgtt ... People are not making the right choices. Delay in care equates to future increased care costs shifting it from peventative/elective/outpatient to complicated/emergent/inpatient, in essence kicking the can down the road.

  • Report this Comment On January 21, 2012, at 12:07 PM, FutureMonkey wrote:

    Thank you azmfool for saying what needed to be said.

  • Report this Comment On January 21, 2012, at 1:14 PM, wan2bretired wrote:

    azmfool (and futuremonkey) ... since neither of you added to the discussion in a meaningful way, who are you to be critical and demean anyone's intellect?

    Should we all respond to these articles with "that a boy", "great article" etc.?

    I do believe name calling and labeling people because the differ from your opinion is wrong on either side of any ideology. True discourse comes from different viewpoints ... you try to convince me you are right, I likewise will try to sway you to my way of thinking. If I have no "basic intellect", as you say because my viewpoint is the 180 degrees opposite of yours, and of course your viewpoint must be right, then maybe the "Fool's Rules" should be only the like minded need reply!

  • Report this Comment On January 21, 2012, at 1:53 PM, haywool wrote:

    How about a tax code like this?

    "You make money, you pay taxes."

    No loopholes. If you have money to spend, you have better paid taxes on it.

    How about an amendment to this new tax code =

    "a. The more money you make, the higher your tax rate

    b. You get caught evading taxes by ANY means, you lose your business and go to jail."

  • Report this Comment On January 21, 2012, at 3:21 PM, FutureMonkey wrote:

    wan2bretired, don't misunderstand me so quickly. It isn't a matter of agree/disagree. Indeed neither Azmfool nor my supportive statement cited any particular position for you to be 180 degrees opposite to. The comment was in regards to the venomous, vitriolic tone of several of the posts.

    Several of the posts brought valuable additions to the conversation, including yours. Morgan provides valuable conversation starters, many posters provide intelligent counterpoints or insights not directly addressed in the article. Some posters seem to be responding to the voices in their head.

    I'll post my specific thoughts about Morgan's article separately.

    FM

  • Report this Comment On January 21, 2012, at 10:44 PM, MountainMedic wrote:

    With regard to the decreasing importation/ increasing exportation of petroleum... With gasoline at $3/gal in my midwest hometown, and more in many areas of the country, why in the world are we exporting anything at all? My view is that if we want to be petroleum independent, we export NOTHING. Doesn't seem to make sense to me. Need oil, but let's export out own. Hmmm...

    'tards....

  • Report this Comment On January 22, 2012, at 12:27 AM, Chontichajim wrote:

    The refined fuel exporting was the one widely reported. It seems logical that we have not lost refining capacity just because Texas and California oil reserves are declining. The spinoff of refineries has probably made them more hungry and hopefully we will see this kind of action in other areas of the energy sector.

    If we go bankrupt due to tax evasion at least Argentina will have some company.

  • Report this Comment On January 22, 2012, at 1:51 AM, TMFRhino wrote:

    Really interesting on the health care chart... I'd always wondered at what point the ridiculously high rates of growth would stop compounding on themselves... I totally missed that slowdown the past couple of years.

    -Eric

  • Report this Comment On January 22, 2012, at 7:01 AM, thehooch wrote:

    This guy Morgan should be working for the politicians! He sure knows how to spin the facts to prove his points! He writes like a lawyer!

  • Report this Comment On January 22, 2012, at 11:42 AM, arcnsparkjohn wrote:

    Interesting article. In response to gkirkmf who blames the recession on prez Bush. In the year 1999 the Glass-Steagall act was repealed.Read about it and what it did for the banksters once it was repealed. Who was prez than...Clinton...

  • Report this Comment On January 23, 2012, at 1:13 AM, somethingnew wrote:

    Excellent article.

  • Report this Comment On January 23, 2012, at 7:14 AM, MJGWR wrote:

    I'm not so sure the US using less oil is such a good thing. I'd say that it's actually a bad thing. I don't think people driving fewer miles really has that much of an impact. I'd say the decrease is largely due to a shrinking economy.

    As for reduced healthcare spending, that isn't necessarily a good thing either. Lower spending typically means fewer services provided. Clearly, there are ways to lower the cost of healthcare, but just taking the vague category of reduced spending, that doesn't mean it's a good thing.

  • Report this Comment On January 23, 2012, at 8:39 AM, umh wrote:

    How much of that exported fuel is subsidized ethanol?

    I don't see how people feeling that they are to broke to drive can be a good economic sign. It may be investment news, but it's not good news for the "average Joe".

  • Report this Comment On January 23, 2012, at 9:33 AM, NEMnyWtch wrote:

    Another great article Morgan! I love your talent for getting all these folks scruff in a ruff on a Monday morning, and I love how when we try to chart the seas of the markets, they always turn into an election debate. Here were three aspects of the economy that have for the most part, gone unnoticed. Perhaps there should be an "American Fool" or "Voting Fool" for the rest of you not focused on investing, trading, and the like.

  • Report this Comment On January 23, 2012, at 9:38 AM, ravenesque wrote:
  • Report this Comment On January 23, 2012, at 5:32 PM, moneytrail wrote:

    There you go again, Morgan, trying to pass off a politically biased, apologist canard as investment analysis when discussing the nation’s economic decay, as you do in more than a few of your “investment analyses,” published by SA.

    Contrary to the title of your article: “3 HUGE RECENT ECONOMIC DEVELOPMENTS YOU MAY HAVE MISSED,” the information in your “investment analysis” is well disseminated among successful business people and investors. In fact, it’s old news. What’s “new” about it is the painfully distorted spin you apply to cold facts.

    Perhaps you can explain the mathematical wizardry employed by you that leads to the conclusion that although America is still importing 50% of the hydrocarbons we use, we have become a “net exporter” of this commodity? Despite having earned a PhD in both physics and mathematics, in addition to a MBA, I must have missed the “new” branch of mathematics: Obamamath, you employ to derive your conclusions. Mathematicians, physicists and plain old common sense would render your “net exporter/50% hydrocarbon importer” syllogism a logical paradox or, in the vernacular: sheer nonsense. It sounds like political spin to me, which seems to be your MO at SA, rather than investment analysis.

    The reason we’re using less and importing less oil and medical expenditures are decreasing isn’t due to some mysterious, recently identified “new” phenomenon you’ve uncovered that the rest of us have missed. It’s because the Great Recession and structural economic dislocations are still plaguing our Nation’s economic well being. Although some of the improvement in domestic production is derived from dramatic breakthroughs in exploration, drilling, “frac” technology and modest increases in MPG in the US vehicle fleet – the overwhelming bulk of the reduction in US energy use is due to reduced consumption resulting from a severely depressed economy. Among knowledgeable investors and business people, worldwide, this is known as a “slowdown in consumer spending.” Whether it is hydrocarbon use, the purchase of medical services or the purchase of socks, the “improvement,” as you refer to it, is the result of a severe reduction in consumer spending because consumers have less money to spend; and, as the price of gasoline pushes towards $4, plus, per gallon (odd for a “net exporter,’ some would say) they will have less to spend. You meekly bury one sentence in your “analysis” mentioning this fundamental, underlying cause of all the trends discussed by you.

    Also, as a side note, the use of ethanol, a food based fuel, along with its multi-hundred-billion-dollar Federal subsidies has caused the price of basic foodstuffs around the world to soar; e.g.- 3x to 4x in some of the poorest nations. Hence, the US is using food as fuel, a shameful way to drive our economic growth, while much of the third world is starving because of obscenely elevated food prices caused by manufacturing ethanol from foodstuffs. This is not a positive trend. It is a misguided, government promoted political agenda that is causing increased starvation around the world.

    Regarding taxes: it appears you believe we need more IRS agents to enforce a 100 year old, decrepit system of collecting revenues from citizens so the Federal Government can continue to spend the peoples’ money beyond its means. This is the same system that costs companies and individual taxpayers hundreds of billions of dollars and hundreds of millions of hours a year to follow. More importantly, for purposes of SA, the system sucks talent and financial resources from the US economy, costing tens, maybe hundreds of thousands of jobs each year, resulting from reduced private sector investing and the loss of the creative talent of the hundreds of thousands of bright CPA’s and lawyers who drain otherwise productive capital from the economy while getting paid handsomely to game a system that no one understands. I find it puzzling that an investment analyst would propose the need for more IRS agents harassing US citizens, rather than seeing the obvious: our tax system is a behemoth that retards and distorts economic growth, and enables those with substantial resources to game the system, while the bulk of the population is oppressed by an anachronistic system of revenue grabs by the Feds. The day will never arrive when political hacks with degrees in economics and government affairs working for the government will be able to figure out how to drain more money from the successful producers in our society so it can be redistributed to the takers, quicker than the former can protect their hard earned financial resources. Successful investors and business people will win that intellectual bout every time. So Morgan, as someone who fancies himself as an investment analyst perhaps you should be thinking about how to collect revenues fairly from all Americans, simply and plainly, without IRS bureaucrats targeting which successful job creators to harass in any given year.

    Again, with all due respect, your “financial analysis” falls short of what most successful investors and observers of our free market economy plainly see. Perhaps you need to step back and have your peers review your so-called analyses to bring you back from your obvious, political agenda. Your analytic guidance is not based on fundamental, factual economic or investment analysis. Sadly, it is editorial tripe, found in the NY Times, Washington Post, Huffington Post and other political publications that can have devastating effects on the many unwary readers of SA, who may trustingly and blindly follow it. You either don’t understand the misdirection of your analyses or, you are intentionally distorting information. I don’t know which is worse, but neither is worthy of a credible financial publication. Fortunately, you appear to be the only political operative writing for SA, which makes it easy to ignore your re-election op eds.

    I’m sure the Obama re-election crew or Rolling Stone has a spot for you in their spin machine.

    Sincerely,

    Moneytrail.

  • Report this Comment On January 23, 2012, at 7:56 PM, hbofbyu wrote:

    Whether true or not,

    Morgan knows how to stir the pot.

  • Report this Comment On January 23, 2012, at 8:53 PM, TMFHousel wrote:

    <<Perhaps you can explain the mathematical wizardry employed by you that leads to the conclusion that although America is still importing 50% of the hydrocarbons we use, we have become a “net exporter” of this commodity?>>

    Addition and subtraction. That's the math I used to determine that the US is a net fuel-products exporter. I even provided a chart.

    Nowhere do I state that we are a net exporter of all hydrocarbon. In fact, I explicitly state otherwise. Please reread, take a deep breath, and have a good one.

  • Report this Comment On January 23, 2012, at 8:56 PM, TMFHousel wrote:

    <<The reason we’re using less and importing less oil and medical expenditures are decreasing isn’t due to some mysterious, recently identified “new” phenomenon you’ve uncovered that the rest of us have missed. It’s because the Great Recession and structural economic dislocations are still plaguing our Nation’s economic well being.>>

    Yes. From the article: "overall spending is growing at a slower rate because we're using less of it -- a fact some chalk up to the financial strains of the recession. One example: According to the Kaiser Family Foundation, 69% of businesses offered workers health insurance in 2000. By 2009, only 60% did."

  • Report this Comment On January 23, 2012, at 9:00 PM, TMFHousel wrote:

    <<Your analytic guidance is not based on fundamental, factual economic or investment analysis. Sadly, it is editorial tripe, found in the NY Times, Washington Post, Huffington Post and other political publications that can have devastating effects on the many unwary readers of SA, who may trustingly and blindly follow it>>

    If you can provide some specific examples of what is factually inaccurate about this article, I'd be happy to clear them up. Otherwise, I'd humbly suggest that you're confusing "wrong" for "I don't agree with you." Which is cool. Let's just make sure we know which is which.

  • Report this Comment On January 23, 2012, at 9:05 PM, TMFHousel wrote:

    Finally, I feel obligated to point out once again: There is nothing politically motivated or Obama-cheerleading about this article other than to the extent your own biases cause you to read stuff that isn't there.

  • Report this Comment On January 24, 2012, at 2:02 AM, decebalvs wrote:

    I don't fully understand what 1 means. Is it good news, is it bad news, does it even matter long term ? It's definitely good that we are increasingly more energy efficient, but is it good news that we don't know how to spend/store the extra energy ourselves, and give it away to people who can spend it better? Don't know.

    Point 2 sounds good at first sight; in the area where I live the prices my insurance pays for trivial services are ludicrous. This chart comes to mind: http://ucatlas.ucsc.edu/spend.php

    So there is a lot of room to improve efficiency. And medical brains are a renewable resource.

    Point 3 states that the money people don't give to the governement have a very small ROI as compared to the money the government invests itself. This may or may not be true. Again, not sure what conclusion we should draw from here.

    One fact is certain: the government does have the possibility to achieve a higher ROI than individuals, simply because they can channel the whole thing on long term *constructive* projects. But will they ?

  • Report this Comment On January 24, 2012, at 2:17 AM, decebalvs wrote:

    I have to add this: I don't understand how some people can be so against Obama, when he is one of the most intelligent and efficient presidents this country had. Believing in different strategies is one think, not being capable of understanding and following the currently voted one, is another.

  • Report this Comment On January 24, 2012, at 10:02 AM, Morgana wrote:

    Does anyone ever study logic anymore?!!!

    I am stunned by the lack of analytic and reasoning abilities exhibited in many of these comments. E.g. "Capital flight occurs because taxes are too high." For whom? What does too high mean? Where is the line drawn between too high and greed? The argument is in the details and people are too busy to deal with that. We live in a culture of sound bites not critical thinking and humanity.

    I am so disgusted with politics and political discussions. People in general dance between hypocrisy and stupidity.

  • Report this Comment On January 24, 2012, at 10:07 AM, Hallucigenia wrote:

    I've talked about the petroleum products thing over on the UK version of this article - it's mostly about the lack of export routes for crude (as evidenced by the discount of (inland) WTI to (seaborne) Brent reaching $30 at times, so it's ended up being refined and exported via product routes. Switching the Seaway pipeline to export should make a big difference there. That $30 oil subsidy has made a big difference to US competitiveness in all sorts of areas, but oil products in particular - hence Petroplus' difficulties at the moment.

  • Report this Comment On January 24, 2012, at 2:17 PM, moneytrail wrote:

    Morgan:

    The essence of our dialogue is this: whether you are talking about a “Jobs Boon” or “3 Huge Economic Developments You May Have Missed,” you seem to be the master of misdirection. Neither the 200,000 jobs in the “Jobs Boon” report, nor the fact that we are net exporters of refined oil products is the relevant information upon which investors can rely. They are single facts which when taken out of context distort the actual investment environment in which we find ourselves.

    In the first case, the “Job Boon Numbers” are suspect based on the wealth of information in the market place, not the least of which is BLS’s misreporting, along with the vast numbers of unemployed and underemployed Americans; as well as the substantial loss of more than 3 million workers in the work force since 2009. The American employment picture is bleak by any objective measure, yet you present an out of context scenario some investors might conclude is a harbinger of brighter days on the horizon.

    Regarding your reporting on net, refined energy export numbers the big story is that fuel prices are at their highest first quarter level in history and our lack of a viable energy policy will continue to harm America until properly addressed; not that we are seeing positive trends in our energy policies. In fact, the numbers indicate the exact opposite: our economy is still tanking as evidenced by reduced energy use by Americans

    .

    In each case, the unwary might conclude from your articles that the American economy is moving along at a progressively, improving clip. Nothing could be further from the truth, as uncovered by scratching the surface of your misleading analyses. Perhaps it’s due to your inexperience in these matters, but you seem to miss the elephant in the room when you focus on numbers that actually reflect the opposite of your theses when the full scope of all the information is incorporated into your superficial presentations.

    Good luck.

  • Report this Comment On January 24, 2012, at 2:23 PM, TMFHousel wrote:

    Moneytrail,

    Thanks for your comments. With due respect, some people like to debate, and some people just like to argue. I believe you are in the latter group. Thanks, and have a good one.

    -Morgan

  • Report this Comment On January 24, 2012, at 2:36 PM, TMFHousel wrote:

    I'll add some points to clarify, however:

    You say my jobs article was misleading because I didn't write that the laborforce has shrunk or that the picture is still bad. But I did write exactly that.

    You say this article is misleading because I wrote that we're a net exporter of hydrocarbons, but I never wrote that.

    You say the energy figure is misleading because the reason consumption is down is because the economy is weak. But that's exactly what I wrote.

    You say the healthcare figure is misleading because it, too, shows a weak economy. But that, too, is exactly what I wrote.

    Again, there's a difference between debate and arguing. I have no interest in the latter.

  • Report this Comment On January 24, 2012, at 3:04 PM, Usurped wrote:

    Maybe there are more good Americans than I was thinking. It's not the taxpayer's failure to pay that is theft, but the gov't taking from the citizen.

  • Report this Comment On January 24, 2012, at 3:06 PM, Usurped wrote:

    Decebalvs where'd ja get that hallucenigenic (sp)??

  • Report this Comment On January 24, 2012, at 5:17 PM, Handworn wrote:

    Mr. Housel, I'm glad for the economic developments and to know about them, so thank you for that. However, if you're going to cite statistics, you need to do better. First, you should cite your link for your statistics. Second, according to the BTS (link below), U.S. drivers have been averaging around 3 trillion vehicle-miles per year for the last few years (I assume you meant vehicle-miles and not person-miles, since that number would obviously be far higher). I don't think 57 million is going to make much of a difference; well under a mile less per car per year. Finally, you guys really need a copyeditor. That's fuel mileage, not fuel millage; millage is a property-tax term.

    http://www.bts.gov/publications/national_transportation_stat...

  • Report this Comment On January 24, 2012, at 5:24 PM, TMFHousel wrote:

    Handworn,

    Thanks. Mileage gain was 57 billion, not million. My bad. Should be updated soon.

    http://www.fhwa.dot.gov/ohim/tvtw/11jantvt/11jantvt.pdf

  • Report this Comment On January 24, 2012, at 8:19 PM, moneytrail wrote:

    Morgan:

    With all due respect, you seem to miss the entire point of why your articles are unsound. You do not grasp the relevance and context of the facts you use to make a case, resulting in conclusions that are at variance with all the relevant information, as understood by most professional investors.

    I guess if you haven't seen it yet, you may lack the capacity to do so. This is not an argument, as you indicate, it's an attempt to help you provide context with your facts and to present sound investment analysis so that your readers aren’t misled by your selective analysis.

    Some people look at a Monet and see a masterpiece; others look at the same painting and see a bunch of dots. You may want to step back so you can see beyond the dots.

    All the best.

  • Report this Comment On January 24, 2012, at 10:43 PM, kyleleeh wrote:

    @Moneytrail

    You said:

    "you seem to miss the entire point of why your articles are unsound. You do not grasp the relevance and context of the facts you use to make a case, resulting in conclusions that are at variance with all the relevant information"

    The only case or conclusions I've read on this article came from you. The author simple stated three facts and possible explanations for them. He made no grand thesis based on these facts...you did.

    For someone who "claims" to have two PhD's and an MBA you don't have very good communications skills. Any relevant point you may have had is going to dismissed outright by saying things like: "I guess if you haven't seen it yet, you may lack the capacity to do so". It makes you come across as little more then a pompous blowhard who angrily trolls the internet looking for an argument.

    try toning it down a notch and see if it doesn't get more support.

  • Report this Comment On January 25, 2012, at 12:18 AM, kyleleeh wrote:

    Also I don't understand how anyone would see America being a net importer of crude but a net exporter of refined petroleum product as being anything other then good economic news.

    If importing raw materials and exporting finished products was not a winning economic strategy, then Japan and Germany would be two of the poorest nations on the earth.

  • Report this Comment On January 25, 2012, at 4:25 AM, lwbaum wrote:

    There is a movement toward evidence-based medicine: doing research to determine which medical procedures or products work, and using those, while stopping practices and drugs that don't work. Let's use evidence-based government spending. If increasing spending on the IRS produces so much more tax revenue than it costs, let's do it! If you object to the complexity of the tax code (as I do), then also simplify the tax code, but not enforcing the law is not a way to simplify the law. Enforce the law AND simplify it, not just one or the other.

  • Report this Comment On January 25, 2012, at 9:38 AM, Handworn wrote:

    Thanks, Mr. Housel, for the clarification and link. I notice we've given back 26 billion vehicle-miles of that reduction in the increase in 2011 from 2010. What was even more interesting, though, was that we've almost doubled our vehicle-miles travelled in the past 25 years, while our population has increased by only about a third over the 1986 number.

  • Report this Comment On January 25, 2012, at 11:53 AM, moneytrail wrote:

    Kyleleeh: “…I don’t understand how anyone would see America being a net importer of crude but a net exporter of refined petroleum product as being anything other than good economic news.”

    Thank you Kyleleeh, you have just made my point with your above comment. If the US was exporting more refined petro products because we had increased our refining capacity I agree, it would be good news, as you inferred from the article. But since we haven’t built any new refineries in this country in more than 30 years the refined petro products we are exporting is due, primarily, to less driving because of reduced consumer spending power and reduced energy use as a Nation resulting from depressed economic activity. These are not positive economic developments by any measurement. Even though Housel alludes to these facts in his article, his main thesis is that the US is making economic progress and the net petro export numbers are a good thing, as you gleaned from his distorted presentation.

    Had Housel presented a full presentation in his article, without emphasizing America’s “net export” status, you probably would not have come to the erroneous conclusion which you did that Housel’s article indicates good economic news. Such distortions of select facts can lead to bad investment decisions. Of the many fine analysts utilized by MF, Housel is the only one who seems to present true facts, out of context, in a number of his articles, thereby missing the actual point of what the facts indicate. Since you seem to favor Housel’s analyses, you might want to familiarize yourself with Housel’s other articles so you can better weigh the accuracy of his presentations. That might prevent you from investing your money based on economic misconceptions.

    Good luck!

  • Report this Comment On January 25, 2012, at 12:03 PM, moneytrail wrote:

    I agree Iwbaum, we need to enforce our tax laws. However, they have become so complicated that enforcement has become both expensive and intrusive to our liberties. The current Code is beyond repair and it invites intrigue by politicians who use the Code to make economic policy by favoring “friendly” industries, depending on the politician’s political views. The only way to have fair revenue collection by the government is by replacing our current tax system with a simple flat tax paid by all Americans, since we all benefit from what this Nation offers, or a straightforward (not a VAT) consumption tax all can clearly see. Result: easy, inexpensive, fair revenue collection by the Feds; no IRS agents badgering citizens.

  • Report this Comment On January 25, 2012, at 12:05 PM, TMFHousel wrote:

    <<If the US was exporting more refined petro products because we had increased our refining capacity I agree, it would be good news, as you inferred from the article. But since we haven’t built any new refineries in this country in more than 30 years the refined petro products we are exporting is due, primarily, to less driving because of reduced consumer spending power and reduced energy use as a Nation resulting from depressed economic activity>>

    As clearly written in the article, one cause for the shift in imports/exports is a decline in miles driven. And nowhere in the article does it state that the change in imports/exports is a all-out positive development.

    I'll even reprint it for you: "U.S. demand has declined for some petroleum products. U.S. drivers drove about 57 billion fewer miles in 2010 than in 2008."

    You state:

    "Even though Housel alludes to these facts in his article, his main thesis is that the US is making economic progress and the net petro export numbers are a good thing"

    I never said that. You did.

    It must be exhilarating to accuse people of things they never said, and scold them for not saying things they did say.

  • Report this Comment On January 25, 2012, at 1:13 PM, kyleleeh wrote:

    @Moneytrail

    Actualy US refining capacity has incresed steadily in the last 30 years from improvments to existing refinaries and is currently at an all time high.

    http://www.eia.gov/dnav/pet/pet_pnp_unc_dcu_nus_m.htm

    Wheather or not that's good news is for the reader to decide on their own, based on our own thoughts and mental filters. If you conclude this is terrible news and it's all Obama's fault, that was decided by your own biasis...not the authors.

    For someone who claims to possess such a wealth of education, it seems that what you really have is indoctrination, and indignation...please understand they are not the same thing.

  • Report this Comment On January 25, 2012, at 2:32 PM, moneytrail wrote:

    Kyeleleeh:

    Yes, improvements in refining technology have resulted in increased capacity, but not to the extent that would result in us being an exporter of refined, petroleum products. The current excess of refined petroleum products available for export is primarily due to a reduction in economic activity over the past several years and reduced driving patterns; e.g.- price-demand destruction, due to record high, refined petroleum prices.

    The causes for these problems are manifold and not necessarily all related to Obama’s policies; although some would argue his policies have not helped much. Personally, I think many of these problems have been accruing for decades and have been exacerbated by our current economic straight jacket.

    Wearing anger on your sleeve and personal attacks on someone you do not know, should cause you to consider your own advice, gratuitously offered to me, about communications skills. I didn’t attack you, Obama or Housel, personally.

    If you believe Housel’s analyses are sound, despite the erroneous conclusions you derive from them, so be it. If you think Obama is doing a good job, vote for him. If attacking me personally by ascribing beliefs to me about which you cannot know, helps your psyche, let it fly. However, keep in mind, neither your positions, nor the investment dialogue promoted on this site, are moved forward by vitriol.

    The best of luck!

  • Report this Comment On January 25, 2012, at 3:05 PM, moneytrail wrote:

    Housel:

    It sounds to me that you have become more interested in arguing than in rational debate, a trait you attributed to me in one of your emails. And, my answer is the same as yours: I have no interest in the former.

    However, because I respect MF and its other analysts’ fine commentary, I will try this one more time. The thrust of your problem isn’t necessarily your facts; it’s the distorted presentation, as evidence by Kyleleeh’s erroneous conclusion regarding your article. Perhaps you should clarify your presentation to Kyleleeh regarding the misleading presentation of your facts, which although they may be accurate, they are out of context.

    Again, I say this with all due respect because my intention is not to personally attack you: your presentation is at variance with the broader developments and direction of the US economy. When I say you seem unable to grasp the distorted message your analyses present, whether it’s about jobs, petroleum exports, health care expenditures or tax collections, it is intended as constructive criticism of what appears to be your presentation of a profoundly inaccurate picture of the current state of the US economy. It's not about Obama, you or me, it’s about the wretched state of our economy and its inability to get untracked.

    That is the overriding issue that should color any investment analysis. Other MF analysts seem to incorporate this overarching theme into presentations in a more integrated way than you do.

    Another bit of gratuitous advice you gave me in one of your emails: take a deep breath and accept this for what it is: a genuine critique of what appears to be inferior analysis; not a personal attack on you. If you are unable to rationally debate the merits of your analyses, perhaps this line of work isn’t suitable for you.

    All the Best!

  • Report this Comment On January 26, 2012, at 12:14 PM, Darwood11 wrote:

    Morgan;

    Thanks for the interesting article. Interesting, because it points out that old axiom "The only constant is change."

    There are a lot of beliefs out there, and a lot of what is supposed to be "information" is something else entirely. This "information" gets parroted and is quoted as "fact." As we all know, saying something over and over again does not make something a fact. But in reading some of the comments, one would never know it!

    There is a clear lack of critical thinking skills in our society. I don't know who failed at this, be it the parents, the schools, or the individuals. Perhaps all three. But I do know that learning is a life long pursuit, and is therefore individual choice.

    When I read your columns, I can say I am "learning" and thank you for that!

  • Report this Comment On January 26, 2012, at 1:21 PM, TMFHousel wrote:

    <<When I read your columns, I can say I am "learning" and thank you for that!>>

    That makes me happy. Thank you!

  • Report this Comment On January 27, 2012, at 1:34 PM, cornell22 wrote:

    How about this? While we send people to jail for tax evasion we also bring back debtors prison.

  • Report this Comment On January 27, 2012, at 3:37 PM, FidlStix wrote:

    "It's amazing more people aren't outraged about this stuff [tax evasion]. Rather, they likely would be if they knew about it."

    What %age of people evade taxes? Any estimates? I wouldn't be surprised if it isn't over 50%. It's hard for someone to get outraged about something they do themselves.

  • Report this Comment On January 27, 2012, at 4:00 PM, drborst wrote:

    Morgan,

    I learn something reading you, and then learn something else from the comments (that the world has become overly politicized).

    The health care bit is interesting. I can't tell from the chart is the latest peak in spending increases is in 2001 or 2002. Also, is %change in total health care spending the best thing to plot here? I suspect a per capita number would be more informative.

    Also, To add my comment about tax cheating. The numbers are large, but again, a relative number might be better. Has the tax compliance rate increased or decreased (doesn't it sit somewhere near 85%, which would be an interesting number to compare with, say Greece)?

    And really, the study about IRS auditors of the 14000 largest corporations doesn't make much sense. They are probably the most productive IRS Employees. I hope the IRS isn't stupid enough to eliminate them. I'd be curious what the least productive 5% of IRS auditors is finding before deciding on wether we should hire more.

    And to get slightly political, maybe we could reduce the amount of work those guys do by simplifying the tax code. Even the IRS claims that would help reduce the tax cheating (at least some of which is un-intentional).

    DRB

  • Report this Comment On January 27, 2012, at 6:36 PM, DeRogue wrote:

    Are you seriously looking at IRS statistics and believing them? And writing columns based on them? I've got this bridge I'd like to sell you. The "

    tax evasion loss" has been nothing but a guestimate by fools for decades. No one knows. But this whole thing fits right in with the Obama ploy to "blame the rich" in order to get reelected. Class warfare at its most insidious. All that will happen out of any of this is that the more productive and successful citizens will simply move elsewhere.

  • Report this Comment On January 27, 2012, at 10:53 PM, TMFHousel wrote:

    DeRogue:

    The tax evasion statistics calculated by the IRS are basically a reference to how poorly the IRS does its job. If it has an incentive to massage the numbers, it's to massage them down, not up. And the IRS has been calculating these numbers for decades. This isn't something unique to Obama.

  • Report this Comment On February 02, 2012, at 11:45 AM, DJDynamicNC wrote:

    @DeRogue:

    Completely agree. When the statistics don't agree with my preconceived notions, it must be the statistics that are wrong, especially when they are from a government agency (unlike statistics from a corporation or partisan think tank, which would have no incentive to ever lie). Also too, class warfare! Those uppity poor folk have all the power these days.

  • Report this Comment On February 07, 2012, at 3:15 AM, thereigoagain wrote:

    Hey, don't tax me , I'm just minding my own business. Why

    don't you tax that guy over there with all that loot , yeah the

    one that's looking at me funny.

    Money flows to where it is regulated the least. This is as true

    as Gresham's law. http://en.wikipedia.org/wiki/Greshams_law

    How to better the status quo ?

    Abolish taxation of any kind. The government can kite it's own

    checks to pay it's way. All government issued checks are

    printed in mass by machines as they are inserted into their

    delivery envelopes. There is also the option by the clerk to

    punch in some random amount. There is only a tally of what

    has been issued but no limit as to funds available restricting the

    writing of checks. How else could there be a budget deficit.

    The government can finance itself in this way without the need

    for taxation ( it amounts to the same thing ) except that

    instead of being left with less money your money is worth less.

    The best thing about it is that it's fair, no wiggle room. In one

    act you reduce the size of government ( no IRS) and several

    hundred thousand lawyers will need to go out and get real

    jobs. Now that has to be worth something.

    Ah but the budget you say what about the budget ? This is

    democracy and presumably those elected act at our pleasure,

    or is that too childish a notion.

    Etymology of Democracy derives from the Greek " Demos

    Kratein " " peoples rule ".

    Etymology of Politics derives from the Greek " Politikos " " of

    the citizens ".

    The action of those rights delegated to elected officials is

    Statecraft. The convenience of this arrangement can be

    disputed by the cantonal conventions of the Swiss. Even if only

    expedient , referendom is the only direct participation in

    governance , anything else is " Yes sir, Boss ". If you give away

    the store you can't readily claim that you've been robbed.

    .

  • Report this Comment On February 28, 2012, at 11:03 AM, AreYouKiddinMe wrote:

    I have seen several comments from that were quite good. Some other folks not so much... Do yourselves a favor please stop responding to MoneyTrail. It just provokes them. This individual has not accurately responded to anyone's counterpoints and as such seems to be the person with their fingers in their ears repeatedly stating. Na na na na. I could site examples but it really doesn't matter as I have added this name to one of my grease monkey scripts and all comments authored by this person on this site will no longer be visible to me.

  • Report this Comment On July 09, 2012, at 2:15 PM, willywolfe wrote:

    The import/export chart is a fake! Go to EIA site and they show we still use nearly twice as much as we produce.

  • Report this Comment On July 09, 2012, at 2:19 PM, TMFMorgan wrote:

    ^ It's not a fake. You're likely looking at crude, not fuel products.

    And as the article notes, "This is far from saying the U.S. is energy independent. We still import roughly half the crude oil we use -- a reliance of about 9 million barrels a day."

  • Report this Comment On July 09, 2012, at 3:00 PM, willywolfe wrote:

    The import/export chart is misleading. That only shows processed petroleum products. Crude oil is coming from outside. Over 7.5 million barrels of oil per day being imported.

  • Report this Comment On July 09, 2012, at 3:03 PM, TMFMorgan wrote:

    <<The import/export chart is misleading. That only shows processed petroleum products>>

    What do you find misleading? The chart's title is "Imports/Exports of petroleum products." I don't know how I could have made it clearer.

  • Report this Comment On July 09, 2012, at 3:04 PM, TMFMorgan wrote:

    <<Crude oil is coming from outside. Over 7.5 million barrels of oil per day being imported.>>

    Yes. And again, this was clearly noted in the article.

    Thanks for reading.

    Morgan

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