Posted on 07/23/2007 6:17:52 AM PDT by Daffynition
The U.S. House of Representatives recently passed legislation instituting penalties of up to $150 million for companies and up to $2 million and 10 years' imprisonment for individuals found guilty of gasoline "price gouging."
But the real gouger driving up gasoline prices is not the private sector – it is our government.
To "gouge" means to extort, to take by force – something that oil companies and gas stations have no power to do. Unlike a government, which can forcibly take away its citizens' money and dictate their behavior, an oil company can only make us an offer to buy its products, which we are free to reject.
Because sellers must gain the voluntary consent of buyers, and because the market allows freedom of competition, oil and gasoline prices are set, not by the whim of companies, but by economic factors such as supply and demand.
If oil companies could set prices at will, surely they would have charged higher prices in the 1990s, when gasoline was under one dollar a gallon.
Because oil companies and gas stations cannot set their prices arbitrarily, they must make their profits by earning them – by efficiently producing something that we value and are eager to buy. In so doing, they assume great risks and expend enormous effort.
Over the decades, oil companies have created a huge infrastructure to produce and distribute gasoline by investing hundreds of billions of dollars in prospecting, drilling, transporting, stocking and refining oil.
In the absence of political factors like the 1973 OPEC oil embargo or the Gulf wars, the net effect of oil companies' pursuit of profit has been to drive the price of oil and gasoline, not up, but down.
The price of a gallon of gasoline (in 2006 dollars) fell from $3 in the early 1920s to $2.50 in the 1940s to $2 in the 1960s to under $1.50 in the 1990s.
This downward trend is all the more impressive because it required the discovery and exploration of previously inaccessible sources of oil and because it persisted despite massive taxation and increased government regulation of the oil industry.
When we see the price of gasoline today, we should not accuse oil companies of gouging but rather thank them that prices are not much higher.
The true culprit that we should condemn for driving up prices is the government, which has engaged – with popular support – in the gouging of both the producers and consumers of gasoline.
Federal and state governments have long viewed gasoline taxes as a cash cow. In 2003, for instance, when the average retail price for a gallon of gasoline was $1.56, federal and state taxes averaged about 40 cents a gallon – which amounts to a far higher tax rate, 34 percent, than we pay for almost any other product.
(Contrary to popular belief, gasoline taxes do not just pay for the roads we drive on; less than 60 percent of the gas tax-funded "Highway Trust Fund" goes toward highways.)
Along with high taxes, environmental regulations – justified in the name of protecting nature from human activity – have dramatically increased the production costs, and thus the price, of oil and gasoline.
The government, for example, has closed huge areas to oil drilling, including the uninhabited wilderness of ANWR and the out-of-sight waters over the Atlantic and Pacific continental shelves. This, of, course significantly reduces the domestic supply of oil.
The government also has passed onerous environmental regulations that make it uneconomical for many old refineries to keep producing (50 out of 194 refineries were shut down from 1990 to 2004) and discourage new refineries from being built (no major refinery has been built in the last 30 years).
Regulations such as these push the surviving refineries to operate at almost full capacity, creating a situation where any significant reduction in the production of some refineries (e.g., from a hurricane) cannot be compensated by increased production in others.
Exorbitant spikes in prices, which many attribute to oil companies' "gouging," are actually caused by government constraints.
If we want to stop the irrational forces that have been driving up the price of gasoline and our cost of living, we must demand that our elected officials eliminate the regulations and excessive taxes that restrict the producers of oil and gas.
It's past time to stop gouging oil companies – and ourselves.
There are hundreds of oil companies in the US. This is only a fraction of the oil companies worldwide.
A
ARCO
Aera Energy LLC
Alyeska Pipeline Service Company
Amoco
Amsoil
Anadarko Petroleum Corporation
Apache Corp.
Arbusto Energy
Ashland Inc.
B
BJ Services Company
Baker Atlas
Baker Hughes
Baker Oil Tools (BOT)
Betelgeuse incident
Bill Barrett Corporation
Buckeye Pipe Line
Burlington Resources
C
Cabot Oil
Calibre Energy
Caltex
Cenex (brand)
Chemoil
Chevron Corporation
Circle K
Citgo
Coffeyville Resources LLC
Colonial Pipeline
Conoco Inc.
D
Devon Energy
E
EOG Resources
Energen
Energen Resources Corporation
Enterprise Products
Equitable Resources
E cont.
Ergon (US)
Esso
ExxonMobil
F
Frontier Oil
G
Gate Petroleum
Getty Oil
Giant Industries
Global Partners LP
GlobalSantaFe Corporation
Gulf Oil
H
Harken Energy
Havemeyer Oil Company
Hess Corporation
Hornbeck Offshore Services
Hunt Petroleum
Hunt Refining Company
K
Kaiser-Francis Oil
Kerr-McGee
Kinder Morgan Energy Partners
Koch Industries
L
Lion Oil
M
Marathon Oil
Marathon Petroleum Company
Marland Oil Company
Merit Energy Company
Mobil
Motiva Enterprises
Murphy Oil
N
NOCO Energy Corporation
O
Occidental Petroleum
OpenSpirit Corporation
P
Panda Energy International
Paramount Petroleum
Parker Drilling Company
Pennzoil
P cont.
Petrohawk
Petroleum Geo-Services
Pilot Corp.
Pilot Travel Centers
Plains All American Pipeline
Prisma Energy International
R
Rentech
Rockefeller family
S
STP (motor oil company)
Saga Petroleum LLC
Samson Investment Company
SemGroup
Seven Sisters (oil companies)
Shamrock Oil
Shell Oil Company
Sinclair Oil
Speedway SuperAmerica
Standard Oil of Louisiana
Starvin’ Marvin’s
Sunoco
Superior Energy Services
Syntroleum
T
Taylor Energy
Terrible Herbst
Tesoro
Texaco
Trans-Arabian Pipeline Company
TransMontaigne
U
United Refining Company
Unocal Corporation
V
VECO Corporation
Vacuum Oil Company
Valero Energy Corporation
W
Williams Companies
X
XTO Energy
Don’t buy gas. Please.
Perhaps you would prefer for the oil companies to assuage your outrage at the large dollar amounts by selling LESS product. That would give you some extra time waiting in line to think about the foolishness of your (misplaced) outrage.
Were you around in 1973 with long lines and rationing based on some digit of your license plate? It was lots of fun. Not!
Wow, such wit. Blackbird.
Second, blame your government. Gasoline on a percentage basis, is the most taxed commodity there is.
Third, how would you feel if the governemnt told you to bank at a financial institute that pays 5%, when you could get 7% down the road. This is basically what you are suggesting by imposing a windfall or profits surcharge to the Oil Companies
How many of these companies are operating in the state of California?
Up thread it was 10%, which was yesterday, down to 8% today. A 2% drop overnight, hence my problem with his statement.
If you do want to look for villans, try OPEC first, whod directly through actions controls a lot of what the price of a bbl of oil is.
I have no problem with that. Thus far, not a part of the discussion, thanks for bringing it up.
Second, blame your government. Gasoline on a percentage basis, is the most taxed commodity there is.
Another point not in contention.
Third, how would you feel if the governemnt told you to bank at a financial institute that pays 5%, when you could get 7% down the road. This is basically what you are suggesting by imposing a windfall or profits surcharge to the Oil Companies
I've said nor suggested any such thing. It's the Greed exposed for what it is, which is my only contention, and there is nothing Conservative about it, never has been, never will be. It may be one of those 21st Century RATpublican traits (forgeting for the moment the RAT's calling the 80's the decade of Greed), but I'll have no part of it being consigned to Conservatives.
All that will be gained from this is a return to a RAT majority for the forseeable future but the RATpublican's have ignored that warning for the last couple of years. Blackbird.
You still have yet to explain how a principle that is the basis for all business, making a profit, is greed. I doubt you and your severely lacking set of cognitive skills can pull that one off.
Are you a government or union employee?
Certainly enough to blow your When the oil companies ... have limited the number of oil companies in existence comment out of the water, wouldn't you agree?
Greed? You're in it neck deep. Surely you recognize it. To you it's just dividends. When is it enough for you corporate welfare parasites?
Are you a government or union employee?
The only government involvement I've ever had was the Military. Never been in a union. What's going to be the next leftist approach to this troll? Hmmmm? DU taught you well. BTW, I skimmed over your very brief posting history and your self described Conservatism is highly questionable. For instance, how is it you'd come down on the side of a multi-million dollar contractor in support of Criminal Illegal Aliens against the Citizens of Georgia? Hmmmm? Was there a buck to made in it for you somehow? You've been exposed troll. Keep 'em coming. Blackbird.
You can’t answer the question. I thought so. Baseless attacks, lashing out blind. Fighting a battle of wits unarmed. Sorry, you lose. Be gone, putz.
Project much? I'm going nowhere troll. Blackbird.
Why not answer the question, then. What is wrong with making profit and investing. By ragging on me as an investor, you are ragging on over 70% of American adults who also invest. Why would I not want to maximize my ROI? It’s not greed, it’s smart investing.
You are also criticizing every single bsiness out there that makes a profit. WTF is wrong with making profit? And when you do more volume, shouldn’t your level of profit go up accordingly? I fail to see how anyone who considers themselves a conservative can have a problem with corporations making profit and individuals making money from investing. It’s EXACTLY what has made America the worlds greatest nation. You are against it, so by extension, you must be un-American. Damn. I knew you were a commie.
I did.
You are against it, so by extension, you must be un-American. Damn. I knew you were a commie.
Keep 'em coming troll! LOL! Blackbird.
Your point was about the limited number of oil companies, and i showed you 104 oil companies working in the USA. I could list the rest of them working worldwide to further blow your incorrect statement out of the water, but I doubt you’d see it that way. Talk about deaf ears!
Make your point anyway, I’ll discus it with you.
BTW, i am not in futures, i am a stockholder. There are hundreds of thousands of us all over the country and the world who invest in oil companies. I doubt any of us really enjoy paying “high” prices for our gas, but we do understand market economics. I beleive your anger is misplaced, it’s not oil companies we should have a beef with, as hey are merely supplying a product we need at competetive prices. We should be disgusted with our gvernment because of stifling regulations, restrictions and taxation.
$2.969
Exxon
2816 Old Hardin Rd
Billings , MT 59101
$2.969
Sinclair
1425 Us Highway 87 E
Billings , MT 59101
$3.009
Exxon
2344 Central Ave
Billings , MT 59102
$3.009
Cenex
1201 Central Ave
Billings , MT 59102
http://www.automotive.com/gas-prices/33/montana/yellowstone/billings/index.html
There are only a small handful of oil companies which produce gasoline and diesel in the state of California. And, since that is where I live and buy fuel, then that is where my concern lies. California is a closed system for fuel production, and only the companies within the state may refine and sell fuel here. So, it doesn’t matter if there are a million different companies, there is a monopoly in California with how these small handful work together to set state prices.
A dozen independently operating companies hardly represents a monopoly.
Automotive.com is not affiliated with any gas station or company. Our goal is to provide consumers with gas price data empowering you to save money at the pump during these times of rising fuel prices. It is important to remember that the gas prices at each station are updated often, and therefore the prices listed above may not reflect the actual prices you see when arriving at the station.Based on this and the unstable nature of gas prices, Automotive.com makes no guarantee of pricing accuracy.
These websites are NOT accurate. How do I know without running into town @ 6:15 AM? My kid works here:
$2.969
Exxon
2816 Old Hardin Rd
Billings , MT 59101
YESTERDAY morning, I took her to work, this station had already dropped their price to $2.95!!! , but this website says this, Lowest gas prices in Billings Last Updated: 7/25/2007 at 2:16 PM
You and they are full of it. That alone put's the rest of their numbers kind of out in LEFT field, if you get my drift. Thick as a brick, but you're one of those Oil Men, with all your neat little "Ross Perot" charts that you parade around this forum doing your bidding on these Oil threads, and frankly I now question every single thing you post, considering you're absolutely in bed with them. You'd likly be willing to bald face lie for them. I offered you pictures, seems to be about your level of understanding since words can't seem penetrate your noggin, do you want them, or would you prefer to keep some credibility on this forum? Your call sonny. Blackbird.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.