slade,

Whenever I do an analysis of the value of a company, one of the valuation methods I use is called the Net Present Value of Future Free Cash Flow. Naturally, the farther off in the future the cash flow is, it will be discounted to a lower amount in the present. Favorable tax policy and a lower cost of capital makes those cash flows more valuable and it will yield a higher NPV. Of course, oil projects are complicated to value (I have no expertise or experience in valuing the oil industry), and you really have to work through a range of assumptions when you do these calculations, assigning a weight of probability for each outcome.

Uncertainly always raises risk, regardless of the business.

If we don’t mess with the tax structure and we do things to keep the cost of capital reasonable, that will go a long way in enabling these drilling projects, as well as other types of energy investments. Nothing I hear from the Democrats suggests that they understand these things at all. Say what you will about Bill Clinton, but at least he had some pragmatism in him and had advisers who were amenable to practical considerations. But, this is a much more Leftist Democratic Party now than it was during the Nineties. When you have congressmen and senators who talk about expropriation of entire companies or expropriation of profits, you are witnessing an entirely different animal than what we are accustomed to seeing.