If you’ve ever played poker or just about any other card game, then you’ve seen the value of information security. As long as your opponents don’t know exactly what cards are in your hand, you have a chance to win. But imagine if, in the middle of the game, someone changed the rules on you to force you to show everyone else your cards, while all of your opponents were allowed to keep their cards to themselves. What would that do to your chances of winning?
Well, according to Bill O’Keefe at Fuel Fix, the Obama regime, Congressional Democrats and the Securities and Exchange Commission are set to impose a regulation that essentially forces American companies to show their competitors exactly what cards they’re holding.
The Securities and Exchange Commission (SEC), with the encouragement of the President and many of his Congressional allies, is finalizing a new regulation requiring domestic companies to make public all payments to foreign governments in pursuit of fossil resources.
Sounds harmless, right? Why would anyone oppose transparency? Nothing could be farther from the truth for those savvy to the workings of global energy development.
You would hope that the President or someone on his senior staff would understand these details and work to promote growth for U.S. companies at a time when jobs are scarce and our economic recovery is anything but assured. After all, the American oil sector is one of the few bright lights in domestic job creation. Allow me to explain why the consequences of the SEC regulation would be counterproductive.
American energy companies competing against foreign firms for the rights to develop resources must place bids with the governments where those resources exist. The governments in resource rich countries across the world receive numerous bids for projects to develop their various resources and then select the one which benefits them the most. Imagine the disadvantage American companies would face if they were required to reveal the dollar amounts on the bids they were placing.
Companies not under SEC jurisdiction (i.e. all non-American companies like China’s CNOOC and Venezuela’s Petróleos) could review the bids U.S. firms are placing and tweak their own offers to be slightly better. That is analogous to playing 5-card draw where all of your cards are dealt face up but your opponents’ cards aren’t. The end result means less business for U.S. companies.
This, from a president and party fond of czars and bills that must be passed before we find out what’s in them. With this regime, it’s always a case of transparency for thee but not for me, and at just about every turn it creates opportunities to make life more difficult for American individuals and companies. Maybe the Democrats are trying to spread the wealth around to Chinese and Venezuelan firms.