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.
You may want to search the internet for some more bogus sources to rely on before you respond, I'm happy to dispell them for you. I live here, get it yet? Thanks for playing. Blackbird.
Proving your own statement of There isn't a one cent difference in the price of gas at any station in Billings, MT was a lie to begin with. Which was my point.
BZZZT! Wrong answer thickney! This conversation started a couple of days prior, when it was, READY?, $2.98 a gallon! Now, let's talk about lies since you haven't got enough sense to walk away, OK?
To: BlackbirdSST There isn't a one cent difference in the price of gas at any station in Billings, MT. The price of gas in Billings, MT ranges from $2.95 to $3.09. www.montanagasprices.com 76 posted on 07/23/2007 7:43:45 PM MDT by thackney (life is fragile, handle with prayer) [ Post Reply | Private Reply | To 70 | View Replies | Report Abuse ]
Gas hasn't been $3.09 a gallon in Billings for more than 6 weeks. You've YET to document your blantant (lie). Care to continue? You're call sonny. Everytime I see you on these oil threads I'm going to point you back to this string of lies, and your credebility is toast. When you find yourself in a hole, quit digging. Blackbird.
You need to turn on CNBC.
You need to read up thread, where it was claimed to be 10% margins (rather late in the evening 4 days ago), then the next morning it was 8%. That was like 4 days ago, what happened today or even yesterday really has no bearing on what was discussed 4 days ago. Thanks. Blackbird.
Depending on the quarter, and how accounting was done, the margin varies from 8 to 10%, meager by just about every other industry’s standard.
I thought of you this morning, when I saw a gas station had dropped their price 6 cents a gallon, and the competitor across the street was 8 cents a gallon higher. Really weird, huh?
He/she/it is really not very bright at all, i wouldn’t bother too much with that one.
You should heed your own advice, chumpsky!
I provided the source of the information in the post I made the claim. The posted price at that time was at gasbuddy.com.
There isn't a one cent difference in the price of gas at any station in Billings, MT
I took her to work, this station had already dropped their price to $2.95!!!
So are all stations now at $2.95?
Perhaps you find name calling and insults the only strength you have to your conflicting claims. Others find them used for different reasons.
Getting dizzy with that spin? Blackbird.
Bad form and a violation of forum rules, but noob trolls are noted for that. My prediction, you won't be with US much longer. Blackbird.
Pound some high sulfer oil troll. Blackbird.
Would that include insults, name calling and threatening to bring old arguments to new threads?
Nope, it's not. Sorry, sucker.
That is stalking, and is a violation of forum rules. Try it once, and the mods will be all over you like stupidity already is.
Wow, you really are clueless. You commie liberal anti-capitalist scum are just not that bright.
I provided the source of the information in the post I made the claim. The posted price at that time was at gasbuddy.com.
A link to false information, and to continue to link to false information after it's been pointed out to you makes your point rather irrelevant. If you continue to make false claims it makes you a liar. I proved you wrong, live with it.
There isn't a one cent difference in the price of gas at any station in Billings, MT
Prove that to be a false claim or move on.
I took her to work, this station had already dropped their price to $2.95!!!
I addressed your dashing hopes of a gotcha already so stop repeating yourself, it's bad form.
So are all stations now at $2.95?
I can't answer that since I haven't been out today. What does your favorite .com have to say? Ready for the pics yet?
Perhaps you find name calling and insults the only strength you have to your conflicting claims. Others find them used for different reasons.
Are you really this dense? If you don't want to be called a liar on a open forum my advice to you would be to stop lying. Not a single claim I've made can you prove to be false. You on the other hand have had your hat handed to you at each turn. I can do this for weeks on end. Blackbird.
Thanks Joe, well said.
False. Be gone troll. Blackbird.
If it's a realted thread it's not stalking and happens every day. Be gone troll. Blackbird.
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