I got an email from a financially sophisticated friend, who tells me there is very bad news from Obama's budget for the oil business. Which ought to come as no surprise.

The current expensing of intangible drilling costs, which have been a benefit to the industry as long ago as I can remember, will no longer be currently expensed. IDC costs generally represent 80 to 90% of drilling costs, hence capitalizing these costs will be a heavy burden on the drilling segment of the industry.

You can see that this is going affect the development decisions of companies planning exploration. Those most affected will be companies already substantially in debt. Think Chesapeake.

But that is not all. It looks like the depletion allowance, presently at 15%, is going to be cut. Additionally, the budget calls for oil and gas producers to become ineligible for the 6% credit on manufacturing activities.

The overall effect will be to slow profit progress for the E&P companies that fit these tax changes the most. Watch the changes in stock prices for the companies. Exxon dropped ten percent on Friday.

If this passes, and it could considering the class warriors running the show now, it will make us more dependent on foreign energy, and since His O'liness has, in every single encounter with the big, cold world outside, rolled over and showed America's soft underside, we will be especially vulnerable.

Charles Gibson, in one of the debates, stated that every time capital-gains tax rates were cut, the government took in more revenue. Why raise them? Obama was wrong-footed; he wants punitive tax rates, for the punitive bit.

And oil companies are evil, of course, because gas has been high at the pump. Although adjusted for inflation, gas is currently about 2/3 the price it was in 1983. Still, the view is widely held that Big Oil is evil.

Big Pharma is evil too--expect an assault on medicine, not for any reason other than to be mean. From this we can expect that medical research will decline in the world into stagnation. Canada, in its socialistic way, has decreed that health is too important to make money off of. And so it is impossible to patent a drug. Considering that it takes about a billion dollars to bring a drug to market, no company in its right mind would dream of doing the research, spend the money to get it past the regulators, to have it instantly be copied by any generic drug company.

Health is very important. It is so important that it is essential that someone make money out of it because that is the only way that we can insure that it will be done well. But that will not do to the regulatory fascists, who will not go with a market solution but are instead absorbed with the bureaucratic/sexual/nannying thrill of hectoring, enforcement and fines.

America is hostage to a bunch of left-wingers who are more concerned with whipping people that they do not like than with the good of the country. Their stated aims are, of course, fairness, but their real aims are beating up on anything which displeases them and damn the consequences.

In this they presented the perfect bill of fare to smug, self-satisfied, lazy people who voted for a man who merely looked good. They did judge the book by its cover. Perhaps one day they will find that the inside of the book is ill-written, confused, retributive, and spiteful. Obama is the best cleaned-up class warrior that I have ever seen.

I wonder if, in a few decades, his tee-shirts will outsell Che's.