Skip to comments.Larry Elder: Playing the Blame Game on Gas Prices (Also link to 2006 article)
Posted on 02/24/2012 4:26:40 PM PST by Mark
California gas prices, already among the highest in the nation, have topped a $4 per gallon average in the state.
At some Los Angeles stations the price has hit $5. Analysts expect this year's national average price for gas will be the highest ever.
Fox News host Bill O'Reilly knows exactly whom to blame. Oil companies, he claims, engage in price "collusion." Collusion, also known as price fixing, is illegal. Over the last 20 years, the federal government, as well as several states, launched multiple investigations into whether the oil companies conspire with each other to set prices.
In 2008 the CEOs of the major oil companies appeared before Congress where they attempted to explain the variables that determine the price. It came down to boring old Econ 101 - supply and demand. To increase supply, they said, allow us to drill in places now off-limits.
When gas hit $4 a gallon nationally in '08, then Speaker of the House Nancy Pelosi blamed the "oil men in the White House." President George W. Bush once ran a small oil company and Vice President Dick Cheney was CEO of Halliburton, a large contracting firm. Pelosi believed these "oil men" actually wanted high gas prices - presumably to enrich themselves and their greedy friends in the oil business.
Now, some people do root for higher gas prices. Environmentalists believe that burning fossil fuel does irreparable damage to the planet. Higher gas prices, goes the argument, dissuade people from driving gas-burning cars and would spur more investment in "clean" energy.
Secretary of Energy Steven Chu, a Nobel Prize-winning physics professor, said in 2008, "Somehow we have to figure out how to boost the price of gasoline to the levels in Europe." At that time, price for a gallon of gas in England was over $8. Now it is about $10.
Imagine the outcry if President Bush's energy secretary had once suggested that it would be a good idea for gas prices to go as high as the Europeans pay. And then prices actually hit their highest annual average ever.
O'Reilly insists the oil companies are cheating because the gas stations where he lives charge the same price. If companies can set the price of gasoline why not charge $10, $15 or $20 a gallon?
The 7 percent oil company profit margin - revenue minus expenses - place this industry group in the middle of the pack, according to an American Petroleum Institute comparison of industry profits from the third quarter of 2011. Computer and peripheral equipment companies (22 percent), pharmaceuticals (22 percent), beverage and tobacco companies (20 percent) all have much larger profit margins. Do they conspire, too?
When Obama became president, the average price of gas was $1.85. It is now twice that amount. But the "oil man" left the building three years ago.
Larry Elder's column appears on Fridays. He can be reached at firstname.lastname@example.org
April 24, 2006
Democrats Eager to Exploit Anger Over Gas Prices
By MICHAEL JANOFSKY
Officials at the Democratic Congressional Campaign Committee, which advises House candidates, said they sent a memorandum to candidates on Thursday offering guidance on using the issue to their advantage. The memorandum includes a "sample statement" that recommends telling voters, "Americans are tired of giving billion-dollar tax subsidies to energy companies and foreign countries while paying record prices at the pump."
prices at the pump topping $3 a gallon in many places, Amy Klobuchar, a Democratic Senate candidate in Minnesota, is making the issue the centerpiece of her campaign.
Didn’t Obama say something to the effect he didn’t mind high gas prices, he just didn’t want them to rise so quickly? Back in 2007.
Yes he did- Rush commented on that today.
>> Fox News host Bill O’Reilly knows exactly whom to blame. Oil companies, he claims, engage in price “collusion.” <<
When it comes to basic supply-and-demand economics, O’Reilly appears “basically” to be a blithering ignoramus.
I don’t think, however, that he’s really so stupid.
More likely, he is just demagoguing the issue in a
quest to attract more viewers.
He’s just looking out for us.
Yeah, I saw that O’Reilly segment, and that issue is one of many issues about which he thinks he is smarter than he actually is. And he won’t let the guest finish making their point, choosing to constantly interrupt them with dogmatic statements of what he believes the truth is. There are certain costs associated with running an energy company and delivering gasoline to the stations, and why he thinks there should be dramatic differences in those costs from one company to the next is beyond me. It seems perfectly reasonable to me that their prices would be similar.
Are those fingers nicotine stained?
Maybe he doesn’t wash his hands after relieving himself.
Go after the damn hedge funds, they are the ones running up futures contracts.
Actually, ban hedging at all - oil would hit 75/bbl or less.
California gas prices, already among the highest in the nation, have topped a $4 per gallon average in the state. At some Los Angeles stations the price has hit $5. Analysts expect this year's national average price for gas will be the highest ever.OPEC did a number on GWB in 2004 (it didn't work); tried to do a number on Gore in 2000 (didn't work, wait yes it did, no, no it didn't); helped swing the midterms to the Pubbies in 1994 and the Demwits in 2006; did a number on the elder Bush in 1992...