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Missouri State Debate Institute Walters/Harris Lab

2008-2009 Refineries

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Refineries 1NC-2/2.........................................................................................................................................................3
Uniqueness-Refineries Increasing...................................................................................................................................4
Uniqueness-Econ High...................................................................................................................................................5
Uniqueness-Refineries Decreasing.................................................................................................................................6
Uniqueness-Econ Low....................................................................................................................................................7
Uniqueness-Econ Low....................................................................................................................................................8
Uniqueness-Econ Low....................................................................................................................................................9
Link debate-Regs don’t hut refineries...........................................................................................................................10
“Any claims that environmental regulations at oil refineries are to blame for recent gas price spikes should fall upon
deaf ears – the two are not related,” Lieberman said. “They are known costs of doing business, and any well-run
business would have accounted for these costs in their plans long before it would have to spike gas prices or run
short of production.” Lieberman cited two recent case studies by Boston University and Pace University that show
environmental regulations do not have any negative impact on oil refineries’ profits that would cause them to need
to raise gas prices. “The bottom line is that the rise in oil and gas prices is indeed a serious problem for my
constituents and for our nation and deserves investigation and a solution. But, to make the unsupported conclusion
that the prices are somehow caused by environmental regulations, while ignoring the more obvious causes and
effects, is not a productive way to reduce prices. It is merely a convenient way to use a very real and immediate
problem to chip away at environmental protections designed to protect our health and environment.” .....................10
I/L Debate-Refinery expansion doesn’t solve oil..........................................................................................................11
Impact Debate...............................................................................................................................................................12
AT-Shock now...............................................................................................................................................................13
AT-Price increases inevitable........................................................................................................................................14
AT-Price collapse inevitable..........................................................................................................................................15

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

Refineries 1NC-1/2
A. High oil prices have allowed oil companies to pour tons of money into refineries-they are
at their highest operating levels in 20 years.
Michael A. Fletcher, (Staff writer), June 23, 2008, “Houston’s Pipelines of Prosperity,” Online,
http://www.washingtonpost.com/wp-dyn/content/article/2008/06/22/AR2008062202084.html?hpid=topnews, Washington Post, accessed
6/28/08.
Soaring oil and gas prices may be a fiscal drag for much of the nation, but here in the self-styled energy capital of
the world they are feeding an economic surge. In nearby Texas City, dozens of contractors' trailers are lined up outside
the gates of massive oil refineries and petrochemical plants, evidence of the billions of dollars in upgrades going
on inside. Machine shops have more work than they can handle. And students from the local community college
are being snapped up for $30-an-hour plant operator jobs, sometimes before they complete their two-year training
programs, part of an intensifying scramble for qualified workers. Employment in the Houston area has grown 2.8
percent in the past year, the highest rate among the nation's 39 largest metropolitan areas and more than nine times
the national rate. Area building permits are up, along with the amount of cargo moving through local ports. More
than 1,800 oil and gas rigs, many of them belonging to the vast energy companies headquartered here, are in
operation across the country, the highest number since the mid-1980s.

B. Climate change initiatives that ration energy, like the plan, will kill refiners and their
expansion.
Oil Daily, 3-24-2004
Refiners face a host of challenges ahead of them, from increased government regulations on the fuels they
produce, to a new, highly complex marketplace beset by extreme volatility into which they must sell their
products. However, the biggest near-term threat facing the sector may be the return to the Senate floor this spring of a climate
change bill sponsored by Senate Commerce Committee Chairman John McCain (R-Ariz.) and Sen. Joe Lieberman (D-Conn.), according to
Gary Heminger, president of Marathon Ashland Petroleum, the US' fifth largest refiner. Addressing members of the National Petrochemical
and Refiners Association (NPRA) in San Antonio Tuesday, Heminger said the McCain-Lieberman bill, known as the "Climate Stewardship
Act" threatens to reduce refinery sales, increase consumer prices for refined products, and cut jobs in the US. "It would ration energy. It
would be the equivalent to a massive new tax for consumers," Heminger said. "When you ration energy, you lose
jobs and make us less competitive."

C. A failure to expand capacity will cause multiple scenarios for severe price shocks and
volatility.
Analyst Wire, 6-21-2004
Thanks to strong demand for gasoline, profits are rising for U.S. oil refiners. But costs are rising as well. The industry is
currently adding equipment that will reduce sulfur emissions as required by the Clean Air Act. The cost: $ 8 billion. This Citgo refinery
outside of Chicago has already spent $ 200 million to meet the mandate and will spend another $ 20 million over the next few years. The plant
s general manager wishes he could have spent that money increasing capacity to meet the scorching demand for gasoline. MARK SMITH,
REFINERY GENERAL MGR., CITGO PETROLEUM: If we were able to use those monies to increase throughput, those are the sorts of
things that we could do otherwise with the capital. But again, it’s a regulated environment and we spend the money where we
have to, obviously. EASTABROOK: U.S. refiners blame decades of tougher environmental regulations for creating
what they call a serious capacity crunch. In 1980 there were 325 refineries nationwide. Today there are fewer than half that number.
Many plants have been mothballed because upgrading them to meet tighter government standards would have
been too expensive. Refiners have compensated for the lost plants by expanding some existing ones. But they say
those refineries are straining to meet consumers growing demand for gasoline. BOB SLAUGHTER, PRES., NATL.
PETROCHEMICAL & REFINERS ASSN.: We re in a situation where the U.S. refining capacity has declined by 10 percent over the last 20
years while the U.S. demand for petroleum products has increased by over 20 percent. Obviously that s a trend that can t continue. And the
answer is we need more refining capacity. EASTABROOK: Refiners also argue the U.S. infrastructure is so stretched
right now that any sort of disruption could potentially cause shortages and price spikes. Just a few years ago a fire broke
out at this Citgo plant, crippling it for nine months. And during that time its output was cut in half. Building new refineries would help ease the
current crunch. But analysts estimate it would take 10 years and about a billion dollars to build one new plant. They say that s an investment
most refiners won t make. SEAN SEXTON, ENERGY ANALYST, FITCH RATINGS: It s really a fine line between their return on capital and
how much capacity is in the industry. And I don t think you ll see many companies investing in growth projects to increase capacity unless
they re confident there s really going to be a really consistent demand for that increased capacity going forward. EASTABROOK: Sexton says
if domestic refiners don t expand capacity and demand keeps growing, the U.S. may have to get more gasoline
from foreign refiners. And that could make gas prices even more volatile than they already are.

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

Refineries 1NC-2/2
D. Price shocks kill the economy-while prices may be high now, drastic shocks will cause a
collapse.
The Guardian, 5-3-2004
However, oil prices last week rose to a three and a half year high of $ 34.78 a barrel for benchmark Brent crude and won't have to rise much
further to hit their highest since the first Iraq war in 1991. US gasoline prices are at an all-time high, above $ 2 a gallon. "Oil really does
matter and oil prices have been the best predictor of recessions in the past 50 years. We are now getting into danger
territory again," says Professor Andrew Oswald at Warwick University. Modern economies, he argues, are transport and
distribution economies and are hugely dependent on black gold to keep them rolling. A sharp rise in oil prices,
apart from hitting the profits of firms which are big energy consumers, also takes money straight out of
consumers' pockets, particularly in the US, where gas prices swing more sharply than in Britain because fuel taxes are low. "And
don't forget China. There is a massive rise in car driving going on there and that means a big increase in world oil demand." Markets have
been spooked by fighting in Iraq and growing unrest in Saudi Arabia, the world's biggest oil producer, as well as a lack of refining capacity in
the US. So economic policymakers have also begun to fret, saying that oil prices are now a "downside risk" to the world
economy, alongside the US current account deficit and slow eurozone growth. The oil price shocks of 1973 and 1979, when
prices more than quadrupled, were directly related to events in the Middle East and western economies were
walloped by inflation and deep recession.

E. Extinction
T.E. Bearden (LTC U.S. Army (ret) Director of Association of Distinguished American Scientists and Fellow Emeritus, Alpha Foundation’s
Institute for Advanced Study) 2000 “The Unnecessary Energy Crisis: How to Solve It Quickly”, 6-24-2k,
http://www.seaspower.com/EnergyCrisis-Bearden.htm
History bears out that desperate nations take desperate actions. Prior to the final economic collapse, the stress on
nations will have increased the intensity and number of their conflicts, to the point where the arsenals of weapons
of mass destruction (WMD) now possessed by some 25 nations, are almost certain to be released. As an example, suppose a
starving North Korea launches nuclear weapons upon Japan and South Korea, including U.S. forces there, in a spasmodic
suicidal response. Or suppose a desperate China, whose long-range nuclear missiles (some) can reach the United States, attacks Taiwan.
In addition to immediate responses, the mutual treaties involved in such scenarios will quickly draw other nations into the conflict, escalating
it significantly. Strategic nuclear studies have shown for decades that, under such extreme stress conditions, once a few nukes are
launched, adversaries and potential adversaries are then compelled to launch on perception of preparations by
one's adversary. The real legacy of the MAD concept is this side of the MAD coin that is almost never discussed. Without effective
defense, the only chance a nation has to survive at all is to launch immediate full-bore pre-emptive strikes and try to
take out its perceived foes as rapidly and massively as possible. As the studies showed, rapid escalation to full WMD
exchange occurs. Today, a great percent of the WMD arsenals that will be unleashed, are already on site within the
United States itself . The resulting great Armageddon will destroy civilization as we know it, and perhaps most of the
biosphere, at least for many decades

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

Uniqueness-Refineries Increasing
Oil companies are dumping billions into the refining industry.
Michael A. Fletcher, (Staff writer), June 23, 2008, “Houston’s Pipelines of Prosperity,” Online,
http://www.washingtonpost.com/wp-dyn/content/article/2008/06/22/AR2008062202084.html?hpid=topnews, Washington Post, accessed
6/28/08.
Jimmy Hayley, chief executive of the Texas City-La Marque Chamber of Commerce, has a similar view. Just three years ago, things hit
a major snag as hurricanes Rita and Katrina damaged oil platforms in the Gulf of Mexico. Also, a 2005 explosion
at the huge BP refinery in Texas City killed 15 people and injured 180, making it the nation's worst industrial
accident in more than a decade. But since then, oil and gas prices have soared, and the oil and petrochemical
companies have spent billions to upgrade their plants and restore their drilling platforms.

High oil prices are stimulating growth in local energy markets.


Michael A. Fletcher, (Staff writer), June 23, 2008, “Houston’s Pipelines of Prosperity,” Online,
http://www.washingtonpost.com/wp-dyn/content/article/2008/06/22/AR2008062202084.html?hpid=topnews, Washington Post, accessed
6/28/08.
Despite the worries, high energy prices seem to be good for business, at least for now. The many exploration and
engineering firms headquartered here have seen a surge in business, as high prices make deep-water drilling and
other more expensive forms of exploration and extraction economically feasible. Local energy consultants are
cutting deals across the globe to sell their expertise in assessing the potential of natural gas and oil reserves. The
number of jobs in Houston tied to energy exploration has increased more than 15 percent in the past two years,
according to the Institute for Regional Forecasting. Work on alternative energy sources, including wind and solar, also has increased.

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

Uniqueness-Econ High
The economy is rebounding-consumer spending is on the rise and the outlook is positive.
Rebate checks ensure that growth will continue.
Bob Willis, June 29, 2008, “Payrolls probably fell, Factories Slowed: U.S. Economy Preview,” Bloomberg, Online,
http://www.bloomberg.com/apps/news?pid=20601087&sid=aykUcWGnPYpg&refer=home, accessed 6/29/08.
The economy grew at a 1 percent pace in the first quarter, following a 0.6 percent gain in the final three months of 2007, making
for the weakest six months of growth in five years. The outlook this quarter improved last week after the Commerce
Department reported consumer spending rose more than forecast in May. Americans used the money from tax
rebates to buy furniture, clothes and electronics after filling their autos' gas tanks. About $48.1 billion in rebate
checks were distributed in May and a total of $78.3 billion went out through June 27, according to figures from
the Treasury Department. Almost all of the tax rebates will be sent out by the second week of July.

The economy is showing signs of recovery-growth in unexpected sectors and rebate checks
are pushing the economy upward.
Kevin G. Hall, June 29, 2008, “Bust, boom or treading water? What’s up with the economy/” Kansas City Star, Online,
http://www.kansascity.com/438/story/684260.html, accessed 6/29/08.
Lots of it, according to Paulsen, who's more upbeat than most analysts. He points to a large number of indicators that have been
better than expected, including retail sales, consumption, capital spending and foreign trade. "I think the economy
is showing signs of bottoming. It's turned the corner," Paulsen said. "If oil would go back to the $120s, do you realize how good
everything would look? If we didn't have this oil spike in the last couple of months, I wonder where we'd be now. I think the negatives
are still there, but they're lessening in intensity." Q. What about those stimulus checks? Are they helping? A. The one-time
tax rebates seem to be providing a boost. Many economists now think that second-quarter growth could be 1.5
percent to 2 percent, in part thanks to the stimulus checks washing through the economy.

Surprise moves by other countries are solving inflation.


Emily Kaiser, June 29, 2008, “Federal Reserve gets help from abroad on holding down interest rates,” International Herald
Tribune, Online, http://www.iht.com/articles/2008/06/29/business/econ30.php, accessed 6/29/08.
Thanks to the European Central Bank and its counterparts in Mexico and India, the U.S. Federal Reserve may
have found a way to delay raising interest rates. In a perfect world, the Fed chairman, Ben Bernanke, would sit back and watch to
see how the limping U.S. economy responds to a series of rate cuts that started last September and the nearly $110 billion in tax rebates going
out to consumers. Instead, inflation at home and abroad has forced him to at least talk about raising borrowing costs, and investors widely
expect him to back up his words with action before year-end. But surprise rate increases from Mexico and India, along with an
ECB meeting on Thursday that is likely to bring modest tightening, may start to sap the global liquidity glut that
has fueled inflation - and do at least some of the Fed's dirty work.

The economy is recovering-we are taking the right steps to solve our problems.
Thomson Financial News, June 18, 2008, “Treasury’s Paulson repeats strength of US economy will be reflected in dollar,”
Forbes, Online, http://www.forbes.com/afxnewslimited/feeds/afx/2008/06/18/afx5131038.html, accessed 6/29/08.
US Treasury Secretary Henry Paulson today repeated that he believes the US is taking the right steps to improve its
economic situation in light of the ongoing housing and credit crisis, and said the value of the dollar will ultimately
reflect the soundness of the overall US economy. Speaking after the conclusion of the US-China Strategic
Economic Dialogue (SED), Paulson said the US tends to lead the way in terms of addressing market shortcomings,
'and I think that's going to be reflected in our currency value.'

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

Uniqueness-Refineries Decreasing
No refineries are being built-green lobby pressure and regulatory burdens check
expansion.
Bob Roper, (banking and investment executive), June 22, 2008, “Backward Policies Behind $4 Gasoline,” redOrbit, Online,
http://www.redorbit.com/news/business/1445319/backward_policies_behind_4_gasoline/, accessed 6/28/08.
Thanks to green pressure groups, no oil refineries have been built since 1976 and all refineries are stretched to the
limit. Huge regulatory burdens and the inevitable lawsuits from environmental groups make it cost prohibitive for
a company to pursue building - or even expanding - an oil refinery.

Refining is slumping-inventories are at a low and refineries aren’t even at capacity.


Brad Zigler, June 12, 2008, “Crude Report Stumps Analysts,” Seeking Alpha, Online, http://seekingalpha.com/article/81033-crude-
report-stumps-analysts, accessed 6/28/08.
U.S. oil refineries are still sluggishly producing fuels, at least by industry analysts' expectations. In fact, refining
activity seems to have actually slowed over the past two weeks. Yesterday's Energy Department oil inventories
report indicated domestic refiners utilized only 88.6% of their productive capacity last week. Insiders had
expected refining capacity to top 90%, a 0.3% increase over the previous week's rate. Crude oil stocks, which were expected to
increase by 100,000 barrels this week, instead fell 4.6 million barrels. At 302.2 million barrels, oil inventories in the U.S. are below
average for this time of year. For the week ending June 6, though, a quarterly backwardation of only 14 cents a barrel in the NYMEX
term structure indicated oil's supply isn't considered all that tight by market participants.

Refineries haven’t been built in years, this trend won’t change.


Laura Mandaro, (writer for Market Watch), June 2, 2008, “Pinched at pump, consumers warm to energy plants,” Market Watch,
Online, http://www.marketwatch.com/news/story/consumers-warm-new-energy-plants/story.aspx?guid=%7BC08205F2-7426-4D7A-A140-
BE2E87D1FB95%7D&dist=msr_1, accessed 6/28/08.
The change of heart could spell less opposition to coal and nuclear plants. But the building of new oil refineries, stalled for years,
is likely to continue to face stiff opposition, said the survey by RBC Capital Markets. In a poll of 1,007 households, the investment
bank found just 16% of Americans said they would oppose the construction of any type of energy plant or facility in their hometown, down
from 23% in 2007. The investment bank conducted the survey May 17-23. Consumers mostly want alternative energy projects such as wind or
solar facilities -- 71% were in favor of such construction, up from 58% last year. But respondents also showed more interest in traditional
energy projects. Some 21% would support a nuclear power plant, up from 17% last year. Some 34% would support a clean coal technology
plant, also higher than the 27% last year. The building of new oil refineries, shelved for at least a decade, is likely to continue to encounter
heavy opposition, however. BP PLC (BP: 67.78, -0.17, -0.2%) (UK:BP: news, chart, profile) is still fighting a legal battle over a $3.8 billion
planned expansion of a refinery in Whiting, Ind., just outside Chicago. Although a majority of Americans attribute the rapid rise in gas prices
to a lack of oil refining capacity in this country, the survey found, eight of 10 Americans say they opposed the construction of an oil refinery in
their hometown. By some measures, the last new refinery was constructed in 1976, though the U.S. Department of
Energy tracks two small refineries built in the early 1990s. Refinery capacity has continued to edge up, though not
as fast as demand.

Companies aren’t building new refineries-it hurts their bottom line.


Eric Alterman (Senior fellow at the Center for American Progress, Distinguished Professor of English at Brooklyn College), and George
Zornick (New York-based writer), June 26, 2008, “Think Again: Drilling Deep to Mislead on Oil Prices,” Center for American Progress,
Online, http://www.americanprogress.org/issues/2008/06/drilling_deep.html, accessed 6/27/08.
We lack the infrastructure to process the oil. Refineries are already so stretched that last
year, the United States had to
import almost 150 million barrels of gasoline. The Wall Street Journal reported oil companies are not building
new refineries because it would be bad for their bottom line. “Building a new refinery from scratch, Exxon
believes, would be bad for long-term business.”

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

Uniqueness-Econ Low
The economy is down-multiple factors prove and this evidence is predictive of future
growth.
Bob Willis, June 29, 2008, “Payrolls probably fell, Factories Slowed: U.S. Economy Preview,” Bloomberg, Online,
http://www.bloomberg.com/apps/news?pid=20601087&sid=aykUcWGnPYpg&refer=home, accessed 6/29/08.
U.S. employers probably cut jobs in June for a sixth consecutive month, while manufacturing contracted at a faster
pace, signaling the expansion is still at risk, economists said before reports this week. Payrolls shrank by 60,000
workers, according to the median estimate of economists surveyed by Bloomberg News before the Labor Department's report on July 3.
The unemployment rate may have fallen after jumping last month by the most in two decades. Mounting job
losses, record gasoline prices and tumbling home values have crushed consumer confidence, raising concern that
spending will retrench once the lift from the tax rebates fades. Businesses are also purchasing less equipment as
fuel costs soar, prompting factories to scale back. ``Job growth is going to be non-existent for the next six
months,'' Maria Fiorini Ramirez, president of MFR Inc. in New York, said in an interview with Bloomberg Television. ``The economy is
sort of staggering along.''

The economy is in the tank and will remain that way for a while-the manufacturing sector
proves.
Bob Willis, June 29, 2008, “Payrolls probably fell, Factories Slowed: U.S. Economy Preview,” Bloomberg, Online,
http://www.bloomberg.com/apps/news?pid=20601087&sid=aykUcWGnPYpg&refer=home, accessed 6/29/08.
Manufacturing, which accounts for about 12 percent of the economy, probably shrank for a fifth month in June, the
Institute for Supply Management's factory index may show on July 1. The gauge probably fell to 48.6 from 49.6 the prior month, according to
economists polled. A reading less than 50 signals contraction. ``Tight credit conditions, the ongoing housing contraction, and
the rise in energy prices are likely to weigh on economic growth over the next few quarters,'' Federal Reserve
policy makers said last week in announcing they were keeping the benchmark rate unchanged for the first time
since August. Central bankers signaled inflation was an increasing threat. Oil prices that topped $142 a barrel last
week are hammering manufacturers. Carmakers, with little relief in sight, are paring output or shifting production
to more fuel-efficient vehicles. General Motors Corp. said last week it plans to reduce North American truck
production by an additional 170,000 units, while adding 47,000 units of car and crossover output.

The economy isn’t rebounding-growth will slump soon and major sectors are at their
lowest in nearly 3 decades.
Bob Willis, June 29, 2008, “Payrolls probably fell, Factories Slowed: U.S. Economy Preview,” Bloomberg, Online,
http://www.bloomberg.com/apps/news?pid=20601087&sid=aykUcWGnPYpg&refer=home, accessed 6/29/08.
Most economists predict the gains in spending won't last beyond the third quarter, as rising joblessness and the
jump in fuel costs continue to hurt consumers. Sentiment among Americans fell in June to the lowest level since
1980, according to results of a Reuters/University of Michigan survey issued last week. Service industries, which
range from homebuilders to mortgage lenders, retailers and restaurants, and account for almost 90 percent of the
economy, probably expanded at a slower pace in June, economists forecast another report from the Institute for Supply
Management will show. The group's non-manufacturing index, due July 3, fell to 51 in June from 51.7 the prior month, according to the
survey median. A worsening slump in residential construction has contributed to the weakening. Commerce may report
July 1 that construction spending fell 0.5 percent in May after a 0.4 percent decline the prior month, according to economists surveyed.

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

Uniqueness-Econ Low
The economy is getting pounded-three reasons.
Kevin G. Hall, June 29, 2008, “Bust, boom or treading water? What’s up with the economy/” Kansas City Star, Online,
http://www.kansascity.com/438/story/684260.html, accessed 6/29/08.
Everywhere you turn, the news on the economy seems dire. Oil prices are through the roof, home prices are
through the floor, the stock market's plunging, and the entire U.S. economy seems shaky. Here's a look at what's going
on, why and when we'll know things are turning around. Q. What's hurting the U.S. economy now? A. There are three big drags on
our economy: the slumping housing market, the sustained rise in oil prices and an increasingly fragile banking
system. Combined, they're socking it to the economy.

Oil is crushing our economy and we haven’t seen the worst yet-we are headed for an
inflationary spiral.
Kevin G. Hall, June 29, 2008, “Bust, boom or treading water? What’s up with the economy/” Kansas City Star, Online,
http://www.kansascity.com/438/story/684260.html, accessed 6/29/08.
Q. How do high oil prices affect today's economy? A. Businesses spend more on oil and products derived from it,
including plastics, packaging and transportation. Consumers spend more of their income on gasoline, leaving less for other
purchases, from restaurant meals to TVs. High oil prices boost inflation, the rise of prices across the economy.
Businesses have resisted passing along all their rising energy costs to consumers, and oil's rise hasn't yet shown
up in "core inflation," the measure that strips out volatile energy and food prices to show deeper trends. But the
longer that oil stays high, the greater the chance of an inflationary spiral in which wages and prices chase each
other upward. Most Americans don't blame falling home prices for high oil prices, but the two are related. "The
weak housing market and banking system undermine the economy and thus the U.S. dollar," Zandi explained. In
response to a weakening economy, the Federal Reserve lowered interest rates. That led to a weaker dollar. Since
oil is traded in dollars, oil-producing nations demand more dollars for oil to make up for exchange-rate losses.
"As long as they (oil prices) are north of $100 and rising, that's a problem. If they start falling in a consistent way back toward $100, I think
you can assume the coast is clear," said Zandi. He thinks that another turning point will be when a prolonged strengthening of the dollar occurs
against the euro, Europe's currency.

The economy is headed for a sustained period of stagflation and the Fed can’t do a thing to
stop it.
Kevin G. Hall, June 29, 2008, “Bust, boom or treading water? What’s up with the economy/” Kansas City Star, Online,
http://www.kansascity.com/438/story/684260.html, accessed 6/29/08.
A. The Fed learned the importance of squashing inflation before it strangles the economy in the 1979-82 period, so
a return to '70s-style double-digit inflation is highly improbable. But the U.S. economy could face stagflation -
weak growth with stubbornly high inflation - indefinitely. The Fed's primary tool to combat inflation is to raise
interest rates to slow the economy. The economy's weak 1 percent growth rate in the first quarter of this year
suggests that an increase in interest rates anytime soon could tip the economy into recession. Most economists think
that the Fed will begin raising rates later this year, but the Fed seems to be betting for now that the current slowdown will keep inflation in
check.

The banking crisis is devastating the economy.


Kevin G. Hall, June 29, 2008, “Bust, boom or treading water? What’s up with the economy/” Kansas City Star, Online,
http://www.kansascity.com/438/story/684260.html, accessed 6/29/08.
Problems in the banking sector began with the meltdown of sub-prime mortgages, given to the weakest
borrowers. That led to a buyers' strike against every institution holding tainted sub-prime assets, with investors
frowning on everything from shares of bank stocks to mortgage-backed securities sold as bonds. The financial
sector is dragging down the broader stock market, much as tech stocks did when the "dot-com" bubble went bust
in 2000-2001. The result is that banks have less money available to lend. Concerns are growing that credit card
debt and car loans will go the way of mortgages and see rising delinquencies soon. Banks are socking away
greater amounts of capital to offset possible future loan losses, so there's less money available for new loans - for
cars, homes or businesses. That further slows the economy and a housing recovery.

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

Uniqueness-Econ Low
The worst is yet to come-the economic slump will continue well into 2009.
David R. Francis, June 29, 2008, “Expect U.S. Economic Woes to Linger Into 2009,” Christian Science Monitor, Online,
http://www.csmonitor.com/2008/0630/p15s01-wmgn.html, accessed 6/29/08.
The financial troubles in the United States are far from over. The economic downturn, probably already a
recession, could last deep into 2009, with rising unemployment and continuing business failures. That's the view
of several economists. "This is not like credit crunches of the past," notes Washington consulting economist Harald
Malmgren, in an e-mail from Tokyo. "What we are going through is a gradual, painful credit contraction, as lenders try to
gather new capital and reduce their [loans]."

The economy is waterlogged-the Midwest floods are killing any hope for recovery.
David Mercer, June 26, 2008, “Floods will cause ripple, not ruin, across US economy,” Forbes, Online,
http://www.forbes.com/feeds/ap/2008/06/26/ap5158851.html, accessed 6/29/08.
Floodwaters receding into the Mississippi River and its tributaries will suck billions of dollars out of the
Midwest's economy, though probably not as much as the 1993 flooding that devastated the region. The impact on U.S. economic growth
is expected to be small, but it is difficult to make accurate estimates because water still stands over farm fields, roads and in many homes.
Forecasts call for more rain across the region through at least Saturday. Federal and state agriculture officials say the real damage won't be
known until after the fall harvest. A report due Monday from the Department of Agriculture should give the country its first glimpse of the
damage to the corn and soybean crops. The Farm Bureau has pegged Iowa's agricultural losses alone at roughly $3
billion, while Indiana agricultural officials estimate the state's losses at $800 million. Experts say it's too soon to
even estimate the losses in Illinois and Missouri, which are also big corn- and soybean-growing states. The
effects of snagged barge and freight traffic, and insurance claims by water-logged homeowners and businesses,
will likely add billions to the financial toll. All told, the natural disaster will deliver a serious but manageable blow
to the U.S. economy, which is already beset by high food and energy prices, falling home prices and a tight credit
market that is making people and businesses cautious about spending, economists said.

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

Link debate-Regs don’t hut refineries


Environmental regulations don’t cause a collapse in refineries.
James Pletcher Jr., (Herald-Standard business editor), June 29, 2008,“Editor dispels myths surrounding world oil woes,” Herald-
Standard, Online, http://www.heraldstandard.com/site/news.cfm?newsid=19809839&BRD=2280&PAG=461&dept_id=468387&rfi=6,
accessed 6/30/08.
There is a myth that environmental and government regulations have hurt refinery development, Kaufmann said.
"Oil refineries are very capital intensive and the only way to make money is to run them 24 hours a day, 365 days
a year. When demand dropped off in 1970s, a lot of companies closed refineries. They are reluctant to expand
refinery capacity until they are sure that demand would be there. There really is little evidence that I can find that
environmental regulations are responsible for a drop in refining capacity.''

Environmental regulations don’t strangle refineries-your arguments are mere excuses for
health-hating businesses!
Joe Lieberman News Release, May 12, 2004, “No evidence for claim that environmental regulations cause gas price spike,
Lieberman says,” Online, http://lieberman.senate.gov/newsroom/release.cfm?id=221456, accessed 6/30/08.
“Any claims that environmental regulations at oil refineries are to blame for recent gas price spikes should
fall upon deaf ears – the two are not related,” Lieberman said. “They are known costs of doing business, and any
well-run business would have accounted for these costs in their plans long before it would have to spike gas
prices or run short of production.” Lieberman cited two recent case studies by Boston University and Pace
University that show environmental regulations do not have any negative impact on oil refineries’ profits that
would cause them to need to raise gas prices. “The bottom line is that the rise in oil and gas prices is indeed a serious
problem for my constituents and for our nation and deserves investigation and a solution. But, to make the unsupported
conclusion that the prices are somehow caused by environmental regulations, while ignoring the more obvious
causes and effects, is not a productive way to reduce prices. It is merely a convenient way to use a very real
and immediate problem to chip away at environmental protections designed to protect our health and
environment.”

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

I/L Debate-Refinery expansion doesn’t solve oil


Refinery expansion won’t do a thing-refineries aren’t operating at capacity and there is a
global decrease in production.
NPR, June 30, 2008, “Do we need more oil refineries?” The Bryant Park Project, Online,
http://www.npr.org/templates/story/story.php?storyId=91625440, accessed 6/30/08.
Would the construction of new refineries help to lower fuel prices? "It won't do a thing," says geologist Ken Deffeyes,
author of Beyond Oil: The View from Hubbert's Peak. The problem, he says, is not a lack of refining capabilities but a shortage
of crude oil to be refined. "Building more refineries won't make crude oil appear at the entry side of the refinery,"
says Deffeyes. Additionally, he notes that while the U.S. has not built a new refinery in decades, oil companies have
added increased capabilities to existing refineries. "We haven't seen oil piling up on the dock waiting to go to the
refineries," he notes. The focus, he says, should be on the lack of crude oil, and he says that problem won't go away. "If
world oil production is not increasing — and in fact seems to be in the process of decreasing — you need fewer
refineries, not more refineries," he says.

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

Impact Debate
There’s no impact-refineries have crashed in the past and I’m fairly certain there wasn’t a
nuclear war.
David Goldman, June 1, 2008, “An ill wind for gas prices…,” CNN Money, Online,
http://www.kktv.com/news/headlines/19444209.html, accessed 6/28/08.
Though slow-moving, weak tropical storms over the Gulf of Mexico can halt oil drilling, powerful hurricanes that
hit land can knock out refineries. That's because about 40% of U.S. refining capacity is located on the Gulf Coast,
namely in oft-hit states like Texas and Louisiana. After Katrina and Rita, 30% of Gulf Coast refineries were shut
down or operating with reductions.

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Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

AT-Shock now
Your uniqueness arguments are wrong-we aren’t in the midst of a shock, this is a steady
supply side increase.
James Pletcher Jr., (Herald-Standard business editor), June 29, 2008,“Editor dispels myths surrounding world oil woes,” Herald-
Standard, Online, http://www.heraldstandard.com/site/news.cfm?newsid=19809839&BRD=2280&PAG=461&dept_id=468387&rfi=6,
accessed 6/30/08.
"Where are oil prices now? Crude oil is traded in New York Mercantile Exchange daily. There has been this very rapid increase in
oil prices. Since about 2003, oil prices have run up fairly rapidly. There was a brief lull, but now they are back up
again. Why are oil prices so high? Demand has gone up,'' Kaufmann said. This situation, he said, has occurred in the 30 developed countries
belonging to the Organization for Economic Cooperation and Development (OECD). However, demand has also risen in non-OECD
countries, including Mexico, China and Brazil. "We would be hard pressed to say there has been a sudden, rapid
acceleration in oil demand in OECD or non-OECD countries. We are not looking at some kind of demand shock. It is a
supply-side issue. Non-OPEC production has gone down in recent years, causing OPEC production to drop, so that even now, OPEC is
barely back in terms of production as it was in early 1970s. As long as non-OPEC countries were able to push into the market, they were able
to weaken OPEC's influence. Now OPEC is back in the driver's seat and it is responsible for the rise in prices since 2004,'' he said.

13
Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

AT-Price increases inevitable


Price increases aren’t inevitable.
James Pletcher Jr., (Herald-Standard business editor), June 29, 2008,“Editor dispels myths surrounding world oil woes,” Herald-
Standard, Online, http://www.heraldstandard.com/site/news.cfm?newsid=19809839&BRD=2280&PAG=461&dept_id=468387&rfi=6,
accessed 6/30/08.
Where will prices go? "In the short term, I think there is some room for oil prices to come back down. The belief is
there is a significant speculative factor in oil prices. We would like to think that speculative bubble over time will
burst and oil prices will come back down. But don't look for even $60 barrel oil anytime soon unless there is a real
collapse in economic activity.

14
Missouri State Debate Institute Walters/Harris Lab
2008-2009 Refineries

AT-Price collapse inevitable


Oil prices won’t collapse-supply and demand will keep oil high
James Pletcher Jr., (Herald-Standard business editor), June 29, 2008,“Editor dispels myths surrounding world oil woes,” Herald-
Standard, Online, http://www.heraldstandard.com/site/news.cfm?newsid=19809839&BRD=2280&PAG=461&dept_id=468387&rfi=6,
accessed 6/30/08.
Oil prices, Kaufmann added, are not going to collapse. "There are real supply-and-demand fundamentals that will
keep oil prices high. One of the reasons oil prices collapsed in the mid-1980s is there was a huge drop in demand. The world reduced its
oil consumption by 2.5 million gallons a day by generating electricity with coal and shutting down refineries. "But, it's very hard to
replace oil that we use for transportation. Then there are the non-energy uses to make plastics, fertilizer and other
feed stocks and these uses are very difficult to substitute. Reducing oil demand now as we did in 1980s will be a much more
drawn-out process. "Demand is forecast to rise. In many regions outside OPEC, we have pretty much depleted the
easily obtained oil. In the lower 48 states, oil production has been declining for about 35 years. In the North Sea,
production has been declining, even though prices are skyrocketing. Production is going down, although prices are
going up.''

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