Skip to comments.An oil 'crisis'?, Part II
Posted on 08/24/2005 7:04:48 AM PDT by manny613
Soaring oil prices have revived the old bogeyman that the world is running out of oil. Economics is a great field for nostalgia buffs because the same old fallacies keep coming back, like golden oldies in music.
(Excerpt) Read more at jewishworldreview.com ...
"They were in the $1.98-$2.00 range last week.
However, the LaCrosse, WI retail prices are about what they were last week: $2.55 at the discount Kwik Trips."
Difference is in the gas taxes. Retail markup I believe is very small.
I agree with everything you've said
Sowell brought in extraction costs for a reason. That reason is that in the "foreseeable" future - according to many who should know - these costs are much more likely to rise than fall. Rise by quite a bit.
I don't think there's any doubt that FDR's election represented a real break with the past - just look at reactions to him which are currently posted on FR if you have any doubts. And he was the best of the lot. Look who gained power in the rest of the world in response to the same pressures.
you, sir, are no liberal.
Well, I've been posting to this site - of my own free will and quite happily - for 4 years. And noone has asked me to leave or complained of my presence. Obviously, things are not as they seem to be.
>>Me too. And maybe someday soon, I will buy a horse. That is part of capitalism too -- the ability to choose an alternative. <<
I bicycle commute. And let me tell you, saving money is the LEAST of the benefits...
Endemic in almost all 'systems' throughout history. The difference this time will be the technology.
Rev.13  And that no man might buy or sell, save he that had the mark, or the name of the beast, or the number of his name.
Yeah, good point. Neville Chamberlain and Albert Lebrun, man, those two sure were pieces of work...
Well said. Gregg Easterbrook and Julian Simon have written great books on this theme. I would go so far as to argue that the average American citizen today enjoys a better all-around quality of life than almost everyone that existed in previous generations in the history of our world.
This doesn't mean that there aren't exceptions of course; there are certainly poor people in America, just like everywhere else, and there are areas where we could get even better. There will always be periods of war and there will always be some poverty and there will always be brief times of economic downturn, but I see absolutely no reason to believe that over the long run things won't continue to improve for a long time to come. Unremitting liberal negativity isn't worth a plug nickel in my book.
I was just responding in kind - outlandish, oversimplistic, hyperbole - to make a point. The real history of the era is still being disputed.
Both pessimism and optimism were results of economic policies and economic realities, not causes of either.
Actually, they work together, reinforce each other - which is unfortunate. Pride goeth before a fall...and, once fallen, it becomes much more difficult to get up.
Optimism is the most realistic view to take if you study American history. We continue to advance and get better over time.
This is the tricky part...and not just of American history. Technological advance is beyond dispute. But is this a better world, a more joyous place to live than the '60s or the '40s, or the '20s or the 1890s? Not in my experience.
Just thought I would let you two know, Gas dropped another $.05 yesterday here. We are now paying $2.44 a gallon.
An Oil 'Crisis'?
By Thomas Sowell
August 23, 2005
With oil prices passing the record-breaking $60 a barrel level and heading even higher, the word "crisis" is now being used and all sorts of political "solutions" are being proposed. Is there really a crisis?
One of the dictionary definitions of a crisis is "the point in the course of a serious disease at which a decisive change occurs, leading either to recovery or to death." Is that where we are when it comes to oil? Are we either going to solve the problem of oil or see it destroy us economically?
Political and media definitions of "crisis" are much looser than the dictionary's definition. In political semantics, the word "crisis" has come to mean any situation that someone wants to use to justify doing something that will be called a "solution." Crises are a dime a dozen by political and media definitions.
Almost as common as crises are conspiracy theories. Whenever the price of gasoline shoots up, California's Senator Barbara Boxer can be depended on to demand an investigation of the oil companies. The fact that previous investigations have found no conspiracies is no deterrent.
Why, then, are oil prices so high?
There is no esoteric reason. It is plain old supply and demand. With the economies of huge nations like China and India developing more rapidly, now that they have freed their markets from many stifling government controls, more oil is being demanded in the world market and there are few new sources of supply.
What should our government do?
We will be lucky if they do nothing. But, with Congressional elections coming up next year, that is very unlikely. Candidates for Congress next year, and politicians hoping to run for President in 2008, are virtually guaranteed to come up with all sorts of "solutions."
These "solutions" will be packaged as brilliant new ideas, courageous and far-seeing. But most will be retreads of old ideas that remain untested or which have been tested in the past and found wanting.
Price controls, arbitrary new higher gas mileage standards for cars, "alternative energy sources," and other nostrums are sure to surface once again.
The last time we had price controls on gasoline, we had long lines of cars at filling stations, these lines sometimes stretching around the block, with motorists sitting in those lines for hours.
That nonsense ended almost overnight when President Ronald Reagan, ignoring the cries of liberal politicians and the liberal media, got rid of price controls with a stroke of the pen.
What happened is what usually happens when government restrictions are ended: There was more production of oil. In fact the 1980s became known as the era of an "oil glut" and gasoline prices declined.
Today production is being held back, not by price controls, but by political hysteria whenever anyone suggests actually producing more oil ourselves. Organized nature cults go ballistic at the thought that we might drill for oil in some remote part of Alaska that 99 percent of Americans will never see, including 99 percent of the nature cultists.
People used to ask whether there is any sound if a tree falls in an empty forest. Today, there are deafening political sounds over oil-drilling in an empty wilderness.
Nor can we drill for oil offshore, or in many places on land, again for political reasons. Nor can we build enough refineries or even build hydroelectric dams as alternative sources of power.
Many of the same people who cry "No blood for oil!" also want higher gas mileage standards for cars. But higher mileage standards have meant lighter and more flimsy cars, leading to more injuries and deaths in accidents -- in other words, trading blood for oil.
Apparently the only things we can do are the things in vogue among nature cultists and the politicians that cater to them, such as windmills and electric cars. That is why we would be better off if the government did nothing and let people adjust their own energy consumption individually in their own ways as the prices of gasoline and fuel oil rise. But that is also politically unlikely.
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