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BECK: T. Boone Pickens is the CEO of BP Capital and author of upcoming -- the upcoming book, "The First Billion is the Hardest: How Believing it`s Still Early in the Game Can Lead to Life`s Greatest Comebacks."
OK. I`m -- I stay away from Congress as much as I possibly can. I can`t even watch these guys. But I`ve seen the clips. And Boone, I have to tell you -- are they this stupid? Are they reckless? Are they intentionally trying to destroy us? What is going on in Washington?
T. BOONE PICKENS, CEO, BP CAPITAL: I don`t know, but surely they`ve got something more substantive to do than what they`re doing, as far as the oil companies are concerned.
BECK: Give me -- tell me -- let people know. Out of all of the oil produced, how much of a role does Exxon play? Out of all of the oil produced every day?
PICKENS: Eighty-five million barrels is the number that`s produced globally.
BECK: OK.
PICKENS: Exxon`s part of that is a little over 2 percent.
BECK: So, we`re sitting here, we`re screaming over 2 percent, like they can control the price of oil, when really, they`re such a small player in the world global game. Where is -- who is -- who is really controlling it?
PICKENS: Well, the state-owned oil companies own in the world today, 85 million barrels. Seventy percent of it is owned by Saudi or Amco, P- Mex, Pertevesa (ph), the state-owned oil companies.
BECK: Congress said -- one of the congressmen said, none of you people are to leave here until you give us an answer on what is going on, why is gas so high? I had a lot of answers.
PICKENS: The answer is very easy.
BECK: Yes.
PICKENS: Yes, OK. It`s 85 million barrels of oil produced every day, and the demand in this quarter is 86.4.
BECK: Right.
PICKENS: OK. So, the demand is greater than the supply.
BECK: Right.
PICKENS: That`s easy to see. That`s why I said, well, you can`t cover 86.4 with 85. So, you come out of inventories. All right, so, inventories are going down, the price is going up. And it`s that simple.
BECK: Can -- because they say, oh, if we drill offshore, which they won`t do; if we drill in ANWR, which we won`t do; if we go for shale, which we won`t do; if we convert coal to oil, which we won`t do; that`s not enough to make a difference.
Could we -- could we be a lot more energy independent if we aggressively went after all of the resources that we have here in America?
PICKENS: Glenn, let me tell you: a fool with a plan can beat a genius with no plan. I promise you that`s the case. We have no plan. We have no plan.
BECK: So why? Why?
PICKENS: All we keep doing is investigating and asking people. We`re importing 72 percent of the oil that we use every day.
BECK: But Boone, I hear this all the time. When I talk to people all across the country. They all say the same thing to me: "Glenn, it`s not this hard. Why is it this is happening?"
And that leads to conspiracy theories that, oh, the oil companies are stifling things, or this is going on. It`s not this hard. What should we be doing right now?
PICKENS: We should be working our way out of a horrible problem. The horrible problem is, at $125 a barrel, we are exporting $750 billion a year out of this country to purchase oil. That`s going to a few friends and a hell of a bunch of enemies.
We are paying for both sides of the war that we`re in. That`s it.
BECK: Right.
PICKENS: That`s what`s going on. We are being fleeced by the $750 billion.
So, OK, what can you do about it? We have -- something we should have done years ago. But the leadership was never in place to accomplish it. If you go back and look at the people that run for president, from back to Nixon`s time, Nixon said, "By 1980, we will not import any more oil."
BECK: I know.
PICKENS: Wrong. But everybody since Nixon forward has said, "Elect me, and we`ll be energy independent." It`s been just the opposite.
BECK: But didn`t we stop -- didn`t we stop -- when we were going to make coal to oil back in the `80s, the Saudis, OPEC crashed the price of oil. Because it`s a little thing called competition. They knew they -- we were serious about getting out of bed with them.
If we did that again and we were serious, wouldn`t that change the dynamics of everything?
PICKENS: There`s been one thing happened from that point to this point.
BECK: Yes.
PICKENS: That is, they can`t overproduce anymore, because they don`t have the capacity to do that.
BECK: All right, well, that`s the other side of the argument, was, they`ll crash it, and it will be too expensive. Do you see us going back to $2, $3 a gallon?
PICKENS: No, no. Because...
BECK: That`s not really reassuring. I don`t like the way he laughed there. I don`t know about you, America, but when he laughed, it kind of scared me.
PICKENS: Let`s switch -- switch to their side.
BECK: OK.
PICKENS: If we had the finite resource that everybody wants, but we want it more than anybody else.
BECK: Right.
PICKENS: Because we`re importing 25 -- excuse me. We`re using 25 percent of all the oil produced every day.
BECK: Right.
PICKENS: Now, we`re importing 16 million barrels, and we use 21 million. So, we supply ourselves with five, import 16. We`re using 25 percent of all the oil, and we have 4 percent of the population. I mean -- somehow, looks to me like we -- our appetite`s way bigger than it should be.
BECK: OK. We`re going to get into a couple of other things.
By the way, in case you don`t know this gentleman, he`s the one who said oil is going to be $150 a barrel, and here we are approaching that.
Different vision for our energy future: wind-ergy.
And a reminder, tonight`s show is brought to you by Sleep Number Bed by Select Comfort. The Sleep Number bed is the one that counts.
(COMMERCIAL BREAK)
BECK: Coming up, Democrats and Republicans, who always disagree on who should be paying more taxes, but in the end, it`s Uncle Sam. He`s going to take his 20 percent, no matter who`s paying.
So instead of arguing over who pays taxes, maybe Congress should just spend some time finding out ways to grow the nation`s economy, like getting out of our way and stop crushing the people who make our economy run. I`m just throwing it out there, something for them to chew on. That`s in tonight`s "Real Story."
Now, when you`re born with the name T. Boone Pickens, you can either be a cartoon character, a country music star or an oil man. T. Boone Pickens, you have just met, about to meet again here, decided on option No. 3. And his latest crude awakening predicted that oil would go to $150 a barrel, because, quote, "Producers are running out of it."
Back to the simple law of supply and demand. Remember, not only does America need more oil but China, India, coming online, sucking up all they can get.
China has doubled its thirst for oil in the last ten years alone. So, it looks like T. Boone Pickens was right. Oil is trading now at $135 a barrel. Oil futures are at $140 a barrel, and the sad reality is, prices are only going up. While Congress, OPEC and the oil executives continue to hash it out, T. Boone Pickens is putting his money where alternative energy is, wind power.
He`s just purchased 667 turbines to run what he says will eventually be a 2,500 turbine wind farm that will cost over $10 billion and power 1.3 million homes. What does it say when an old-school oil man bails on crude and takes to the air?
Joining me again is T. Boone Pickens, CEO of BP Capital, author of the upcoming book, "The First Billion is the Hardest: How Believing It`s Still Early in the Game Can Lead to Life`s Greatest Comebacks."
I want to talk to you about wind power here in...
PICKENS: Before you do...
BECK: Yes.
PICKENS: OK, Glenn, the other day, somebody said, "Should we start identifying you as wind man?"
And I said, "No. Neither wind or gas man. I prefer oil man." And you did that. And I appreciate it.
BECK: Oil is where it all starts. You know what people don`t understand: oil is in everything. Every time I go to the store, and I buy a piece of meat, I look at the Styrofoam tray. I kind of like the fact that it`s all wrapped up. That`s oil. I mean, it`s everywhere.
PICKENS: And we`re importing it.
BECK: Yes. That`s crazy. All right. Let me go -- let me take you here for a second. You said oil was going to go up to $150 a barrel. And lo and behold, here we go. A lot of people say it`s because you`re basically -- you`re the E.F. Hutton of oil. You speak, people listen, speculators jumped in. Tell me if you buy into the -- this is all a giant oil bubble, and it`s just speculators making money.
PICKENS: Well, it`s not speculators. Speculators have nothing to do with the price of oil. There`s 85 million barrels, and the demand is greater than 85. So, supply and demand are in very critical balance.
So you put a speculator in there, what can they do? They can`t do anything. And, you know -- and they talk about value of the dollar, get the value of the dollar up, and it will make oil prices go down. That, too, is a myth.
BECK: You know, I -- because I believed that, that the value of the dollar, until the last couple of days, when the Fed has said, "OK, we understand. It`s getting bad. We`re going to stop cutting interest rates."
We didn`t see oil prices move down, which they should have, if it was tied to the dollar. So, you`re saying this is all just supply and demand, that`s it.
PICKENS: That`s it. Remember, I`m a geologist, not an economist.
BECK: Right. Real quick question on this. Something else that bothers me. Paying these oil executives all this money. I said today, I make a good amount of money. Not you, but I make a good amount of money. I couldn`t do that job. How many people could run Exxon? You can`t pay them, like, you know, $100,000 a year to run this company...
PICKENS: The thing about it is, Exxon is a valuable asset for this country, as is Chevron, as is ConocoPhillips, all of them. I mean, that`s valuable for us. We don`t have a state-owned oil company like gas problem for Russia, OK? We don`t. We have free enterprise system, capitalist democracy and all. And here they are. What they pay these people...
BECK: Is irrelevant.
PICKENS: And these people pay taxes.
BECK: Right.
PICKENS: I`m glad, you know, soak them for the taxes. Let them pay taxes if they`re going to make the money. They -- the oil companies pay the taxes, too. Talking about windfall profits tax, that`s unfair to the shareholders.
BECK: How much is oil going to be at the end of the year?
PICKENS: Maybe $150.
BECK: A hundred and fifty, which means how much at the gas pump?
PICKENS: We`ll see $150 before the year`s out. I won`t say at the end of the year it will be $150, but we will see $150 during the year.
BECK: Any idea how much that means at the gas pump?
PICKENS: Gas pump? Oh, you`ll be $4.
BECK: I`m paying $4.42 now. But I live in Crazy Town, USA.
PICKENS: Well, you`ll be $4.50.
BECK: Yes. All right. T. Boone -- we`ll be back with T. Boone Pickens here in just a second. We`ll talk about wind energy.
By the way, if you`d like to hear my take on peak oil -- that`s what you`re coming here for, isn`t it -- and 20 other big problems facing our country, it is never too late to pick up a copy of my No. 1 "New York Times" best-selling book, "An Inconvenient Book." After all, what a better gift to give your dad for Father`s Day than a solution from me on any topic? It`s "An Inconvenient Book," available right now at Amazon.com.
Back in a second.
(COMMERCIAL BREAK)
BECK: Back talking to oil, wind, energy challenges facing our country with a man who knows them well, T. Boone Pickens, CEO of BP Capital, and author of upcoming book, "The First Billion is the Hardest: How Believing It`s Still Early in the Game Can Lead to Life`s Greatest Comebacks."
I just asked you in the break, how long before this breaks the back of our economy? And you made me break out into a sweat. You said we`re here. What do you mean by that?
PICKENS: We`re here. We`ve peaked on oil production in the world.
BECK: OK.
PICKENS: Now, we can continue to drill, and try to bring it up.
BECK: Right.
PICKENS: But we`re replacing the declining production every year of six million barrels. So before we get to 85, we`ve got to replace six.
BECK: Because it`s declining every year.
PICKENS: That`s right.
BECK: All right, so -- but my question is -- at what point do you think oil has to be before planes don`t fly and we can`t move trucks like we move trucks now? Our whole economy is built on cheap oil.
PICKENS: That`s right. And we`ve produced our oil. I mean, that`s why -- we peaked in 1970 at 10 billion barrels. Not we`re down to five. So, we peaked in `70. The world has peaked, I believe, probably in 2006 or 2007.
BECK: So, this is why you are in wind.
PICKENS: It`s one of the reasons. It is.
BECK: See, I read a lot about wind, and I get conflicting reports. First of all, how long do you think it will be before the environmentalists, say, call you a bird killer for all the birds these windmills will kill? Because I`ve already -- I talked about it on the air once, and I got a lot of people who are bird lovers who said that.
PICKENS: Well, I know they say that, but if you look at the speed of the turbine, and it`s located -- the hub is at 280 feet up. And then you have the tip on the radius, another 120, so -- it`s up high, and birds do fly at that. But if you`re not in a fly-way, you`re not going to be killing many.
BECK: Here`s -- I can`t remember what country it is that has a lot of windmills.
PICKENS: Germany.
BECK: And don`t they import other energy to supplement this, because sometimes the winds don`t blow...
PICKENS: Of course. Look at who developed wind first. Most highly developed areas are Germany and Spain. They don`t have that much wind. We do. We have this unbelievable resource that`s right up through the heartland of our country. The land owners would like to have the turbines. It creates an economy that`s been missing in that part of the United States for years.
You`re going to see a rebirth all the way from Sweetwater, Texas. The wind capital will be Pampa, Texas, and all the way to the Canadian border.
BECK: Now, people tell me that you would have to have a row of wind turbines from New York to Florida all the way back and forth, I don`t remember how many times, just to power New York City. True or not?
PICKENS: That`s somebody that doesn`t understand, but more than that, that`s a negative thinker that wants to tell you, oh, that won`t work. Let me tell you, what we`re doing is not working. I can tell you that. Spending $750 billion a year for oil is not working.
BECK: So we should be building all kinds of alternatives, but should we also be drilling offshore? Should we also be in ANWR?
PICKENS: I don`t care whether you go offshore or not. It is not going to solve the problem. But it will help.
BECK: Right.
PICKENS: It would help. My dad used to say, "Son," he said, "it`s time to do something now, even if it`s wrong." And that`s where we are in this -- this mess that we`re in. We have to do something more.
BECK: T. Boone Pickens, thank you so much.
Coming up, why illegal immigrants working in America today amount to nothing less than modern-day slaves. Tonight`s "Real Story."
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