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TechnoratiWith the stock market sliding down around the 11,000 marker, with unemployment up, and gas prices up, and food prices up, and home foreclosures up, Bush acknowledged on Friday, in his usual perfunctory manner, that "these are tough economic times for the American citizens."
But what does he know?
It was just a couple months ago when he was making fun of a reporter for asking him about gas approaching $4 a gallon so clueless was he.
Now it's approaching $5 a gallon.
He's so indifferent to "tough economic times" and has been his whole life that he can't get off his ass to do anything about it.
Instead, pathetically, he blames Congress.
On Friday, in his radio address on Saturday, and then on Monday with his executive order lifting the ban on offshore drilling, he reduced all of our economic problems to rising oil prices, and then he reduced that problem to inaction by the Democrats.
He pointed his finger at Democrats for opposing offshore drilling-though Bush's brother Jeb, down in Florida, opposes it, and so does Arnold. Bush also said the Dems were at fault for not allowing drilling in ANWR. He said we can "reach this oil with virtually no impact on the land or local wildlife." The word in that phrase that troubles me is "virtually."
Bush didn't say a word about oil companies gouging the consumer. Nor did he mention that they've not been drilling for oil on much of the public lands that they already have leases to. It's in Big Oil's interest to limit supply, and when they own the wells, the refineries, and the pipelines, they can distort the market.
Nor did he say a word about the need to conserve here at home. He didn't propose lowering the speed limits, or giving incentives to buyers of fuel-efficient cars, or supporting more mass transit, or subsidizing solar power (as Bernie Sanders of Vermont has proposed) by putting solar panels on all federal buildings around the country.
No, he takes demand as a given, and focuses solely on supply.
Of course, rising demand from China and India is also part of the equation. But prices are skyrocketing not just because "demand is outstripping supply," as he put it.
It's also because of his Iraq War, which took a lot of oil off the market.
And it's because of his-and Israel's-saber-rattling against Iran, another huge oil producer. (Michael Klare of The Nation has demonstrated this ably.)
The speculators have factored these risks in, and that's helping to goose the prices.
Of course, Bush won't take any responsibility for this.
He won't take responsibility for anything!
He blames Congress. That's so easy.
But even his framing of the problem is skewed. The problems with the economy are not all tied up in rising oil prices. They are also linked to the government's failure to adequately regulate the housing market and Bush's failure to make the economy work for the majority of the American public, which has seen a pay cut in real terms over the last few years.
The Bush economy has been good for the investors in Big Oil and Halliburton, not for working people who are losing their jobs, not for middle class people who've seen their 401(k)s dwindle.
Bush's fundamental economic impulse, his guiding principle, is to help the rich ("his base," as he called them in Fahrenheit 9/11). But that has not brought sturdy economic growth. His tax breaks for the rich did not trickle down. His trade deals for the multinationals destroyed jobs here at home. And when the economy sank, he didn't throw people a good enough rope. The tax rebates have not been sufficient: $600 just doesn't cut it when you're losing your house or your job, or when your car is guzzling that amount in no time, or your health care costs are ballooning, or you see your life's savings vanishing.
Every effort at a foreclosure moratorium, every effort at a much-needed public works program, every effort at turning the economy green Bush has opposed.
He won't lift a finger.
He'll only point one at Congress.
Matthew Rothschild is the editor of The Progressive magazine.
© 2008 The Progressive
60 Comments so far
Show AllYes starkraving, we are determined to live good lives in spite of Bush, certainly not with his help. His job is really to make life as miserable as possible for the greatest number of people. Our job is to take it like good little sheep, say nothing, do nothing, and die.
Bush is your worst psycho-criminal nightmare. I have a sneaking suspicion he likes the Book of Revelations so much because it talks about him all the way through. Forget Macchiavelli, he wants blood up to the horse's bridles - your blood.
"The Monopoly" gets beat up again by another 5 dollars a barrel today.
KEM: Must be the influence of the "7 sisters" (oil cartel equivalent) MiMiCCS just related above!
STARK RAVING: Great comments. I take them to heart, that's why I keep writing... and showing kindness & generosity where possible.
I have no idea why that last comment posted seven times.
GW Bush is neither irresponsible nor clueless. GW Bush is responsible to his wealthy patron$ and handler$. The rate of the transfer of wealth from the overwhelming majority of the populace (95%)to the tip-top uber-wealthy has progressed steadily every year of his predsidency. For this pampered socialist minority (using the US treasury as their own no-limit ATM)this economy is their fondest materialist-erotic fantasy come true.
He knows good and well what he is "suppossed" to say in order to simulate the impression that he cares about the rest of us. He neither believes what he says nor will he actually do anything to help the desperate in our midst. Instead all his "happy talk" is a raising of his middle finger at those whom he has economically screwed.
I replied but it was blocked by WORD PRESS.
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Kem, I have also read a number of newspaper articles describing people whose job it is is to drive around recording the numbers on signs and to report them back to company HQ.
"I don't dispuste the fact that sometimes the price of gas goes down."
OK.
"with the intent to convey that the Oil company bean counters know how to make a buck out of a dime."
Right, but there are times where oil companies lose money, like during much of the eighties. The "monopoly" charge doesn't account for that period.
"Funny how you know so many dealers ~JAKE~ and they tell you what they do concernig their business. "
One is less than 100 yards to me, I talk to them about it all the time. The others, when I had time and there was no line, I just talked them up,
"Somebody trying to argue there is competition in the oil industry."
If there were *no* competiton, how do you explain what happened in the trading pits for oil over the last two days where prices declined *sharply*? How could the buyers just beat up the oil monopoly like that? And the frantic trading pits with all the shouting and waving, that's just for our entertainment, right?
That was some very interesting info ~MIMICCS~. Thank you for posting that.
Hey ~JAKE~ I don't think ~Siouxrose~ was trying to insult you, she was asking a rather obvious question that likely is not obvious to you.
No ~JAKE~ I don't dispuste the fact that sometimes the price of gas goes down. I also don't dispute the fact that when I wrote ("the oil companies bean counters have their own theory on economics,") it was written with tongue in cheek, ya know, -ha ha- jokingly, with the intent to convey that the Oil company bean counters know how to make a buck out of a dime.
Funny how you know so many dealers ~JAKE~ and they tell you what they do concernig their business. Are you a area rep for the dealers of a major oil company?
Ya know, I'd bet very few people are that familiar with more than one dealer. I say that as I was once a franchise dealer for a major oil ocmpany and we didn't do what you describe, nor did I tell people how I managed my business. The Joe Blow dealer and my stiff competition would come in and read my meters after hours, to see how much gas I was pumping daily. I caught him at that one night. Now most stations have shutters over the meter reading numbers when they are not open for business.
acc
on the one hand, there is almost nothing a person or couple can do to live harmoniously in hell! so first order of business is to get out of that frame of reference. it is entirely appropriate under the circumstances that life is getting harder, "the harder they come, the harder they fall" - you cannot rape and pillage for generation upon generation without being brought low at some point. so, this will be our turn to feel what its like looking up from the bottom. if it doesn't shake you to your core, you've got a loose screw somewhere.
then there's that proverbial other hand. rabbi michael lerner talks about the left hand of god, about putting one's spirituality into the service of progressive change. he asks us to embrace the notion that as isolated as we may get sometimes there are literally millions of us just out of physical, but well within metaphysical reach. live for that connection! go deeper into your own heart...cultivate commpassion for all, including yourself. resolve that nothing and no one, certainly not a dufus like bush, has the power to rob you of your innate indwelling gift, or to prevent you from sharing it.
Wow. Somebody trying to argue there is competition in the oil industry.
Get me some of the jakenewton coolaid.
Little history and some facts.
Everybody knows OPEC. They have most of the worlds known reserves and supplies over 40% of the world. They were created in 1960, for the purpose of setting oil prices by controlling oil production. Most people thought OPEC was owned by Arabs, and that was the point. It was actually an international group which includes Americans and European ownership of the seven sisters who wanted to hide their influence since they had a plan for the 70's.
In reality, ownership of the oil in the ground is fine, but without the ability to get it and transport it to the buyers, the control over oil still was with the seven sisters.
The initial cartel goes back to 1920 with Royal Dutch Shell, Anglo-Iranian, and Standard Oil. By 1949, the cartel was made up of Anglo-Iranian, Socony-Vacuum, Royal Dutch Shell, Gulf, Esso, Texaco, and Calso.
By 1984 the 7 sisters included Exxon (was Standard Oil of New Jersey, then Esso) Mobil (was Standard Oil of New York, which merged with Vacuum Oil)
Chevron (was Standard Oil of California) Texaco, Gulf Oil (controlled by the Mellons) Shell (Royal Dutch Petroleum). British Petroleum (Anglo-Iranian). They controlled 90% of world exports since they controlled the pipelines and the oil tankers.
Also, look at the ownership of these OPEC oil companies
http://www.modernhistoryproject.org/mhp/ArticleDisplay.php?Article=Final...
Aramco Saudi Arabia - Exxon: 30%, Mobil: 10%, Chevron: 30%,
Texaco: 30%
Kuwait Oil Co. -British Petroleum: 50%, Gulf: 50%
Iraq Petroleum - British Petroleum: 23.75%, Shell: 23.75%,
Compagnie Francaise des Petroles: 23.75%, Exxon: 11.875%,
Mobil: 11.875%, other: 5%
Iran Consortium - British Petroleum: 40%, Shell: 14%, Gulf: 7%
Exxon: 7%, Mobil: 7%, Chevron: 7%, Texaco: 7%, Compagnie Francaise des Petroles: 6%, other: 5%
Abu Dhabi Petroleum Co. - British Petroleum: 23.75%, Shell: 23.75%
Compagnie Francaise des Petroles: 23.75%, Exxon: 11.875%
Mobil: 11.875% , other: 5%
Abu Dhabi Marine Areas - British Petroleum: 66%, Compagnie Francaise de Petroles: 33%
Bahrain Petroleum Co.- Chevron: 50%, Texaco: 50%
Since the 70's and the oil shocks, much of the ownership in the OPEC companies has reverted back to national control. Big Oil sold the shares off to the national governments to get funding to monopolize the oil industry at home. Big Oil still held the real control over OPEC since they controlled the distribution and drilling technology. Iran would love to develop more oil and refineries but can not do so as a result of sanctions.
The seven sisters were interlocked with the top 8 banks in the US.
Whats good for Big Oil is good for the bankers and vice versus. They are basically merged today, as is much of Big Business. With the help of Big banking and the funds from selling off their shares to the Arabs, they were well positioned to consolidate the power.
Due to mergers and acquisitions the Seven Sisters are now the Four Sisters, so what you have now is an expanded amount of power and influence that is concentrated in less hands.
Chevron, British Petroleum, Exxon, Conoco
So the biggest 12 (include 7 sisters) became the 4 sisters today.
Many of those other national oil producing countries go along with Big Oil. If you think Exxon is paying market price for Nigerian oil, or any countries oil, you are dreaming.
Some say the power has shifted, and the new seven sister are:
Saudi Aramco (Saudi Arabia)
JSC Gazprom (Russia)
CNPC (China)
NIOC (Iran)
PDVSA (Venezuela)
Petrobras (Brazil)
Petronas (Malaysia)
These guys are certainly not a cartel. The Saudis and Brazil are under our control. Venezuela and Iran will be our next victims. China is a net importer of oil. Malaysia, give me a break.
Russia is really the significant player we do not control. But by themselves, can do little.
"JAKE NEWTON: Is your ideal DATE a tape recorder and a mirror?"
And again *&you* refuse to address any of my points, and instead make clever insults. *shrug*
"Nope ~JAKE~, the major oil companies know exactly how much they wish to make on every gallon of gas in any geographical location. "
They can "wish" all they want, the actuallities of the market are what decides their margins.
"They don't check to see what price ~Joe Blow's~ "no brand name" station is posting. Joe Blow however checks daily to see what the major brands are posting."
How do you know this? I posted an article saying you are wrong, and I have interviewed the managers of half a dozen stations, and they all say that every day they check the stations in the area, phone it in, and post what the management from HQ. says. And if the majors ignore the independents as you say, they run the risk of being undercut by them.
"The oil companies "bean counters" also have their own formula for "The Theory of Economics". ___ Which is: When suppy and demand goes up, ___ the price goes UP. When supply and demand goes down, ___ the price goes UP. "
The problem with this Kem is the indisputible *fact* that sometimes gas prices go *down*. You don't deny this do you?
All the talk of the oil "monopoly" brought back memories of Econ 101. Oligopoly or even cartel was a word used back in the 80s in my Econ classes to describe the oil industry.
Here's what wikipedia says: Oligopoly is a common market form. As a quantitative description of oligopoly, the four-firm concentration ratio is often utilized. This measure expresses the market share of the four largest firms in an industry as a percentage. Using this measure, an oligopoly is defined as a market in which the four-firm concentration ratio is above 40%.[citation needed]
Oligopolistic competition can give rise to a wide range of different outcomes. In some situations, the firms may collude to raise prices and restrict production in the same way as a monopoly. Where there is a formal agreement for such collusion, this is known as a cartel.
******
While I don't know that the oil industry is an "oligopoly" by the 1st paragraph's definition...you all seem to be talking about the collusion to raise prices and restrict production which is what an oligopoly is all about.
Perhaps there is a better economic word...monopoly sure isn't it though.
Nope ~JAKE~, the major oil companies know exactly how much they wish to make on every gallon of gas in any geographical location. They don't check to see what price ~Joe Blow's~ "no brand name" station is posting. Joe Blow however checks daily to see what the major brands are posting.
The oil companies "bean counters" also have their own formula for "The Theory of Economics". ___ Which is: When suppy and demand goes up, ___ the price goes UP. When supply and demand goes down, ___ the price goes UP. And that is how their friggin CEOs manage to drag down $billions a year and do so without paying any income taxes on it.
JAKE NEWTON: Is your ideal DATE a tape recorder and a mirror?
Great posts: GOT METTA & BRIAN B. Frankly, Gaia's into revenge mode because of the way her BODY has been burned, pillaged and plundered by all those guys in uniform that think power comes down to senselessly killing anything and anyone in their paths. If the end of oil brings us back to war with sticks and bones, perhaps it will be worth it. (I said perhaps.)
Here is an article discussing present and future data collection methods that help decide retail gasoline prices:
http://www.npnweb.com/uploads/featurearticles/2007/Technology/0507_tu.as...
From the link:
Price optimization software can "let you do in 20 minutes what used to take two or three hours," added Simon Bravo, vice president for global pricing solutions at Market Planning Solutions. That efficiency also stems not only from faster processing of collected price data, but making better use of the data collected. "We see retailers go out and collect prices from 10 or 15 competing stations for a given location," he observed. "But then what do you do with that data?"
"You didn't think anyone was going to check that out, did you jake?"
The point remains the same.
"The majority of the major brand stations are now company owned and they hire managers to manage them, but those managers do not determine the selling price, the oil companies do. "
The question is *how* do they determine the selling price. They get information on a daily basis as to the pricews on the signs of other stations in the area, then tell the managers what price they should post.
"Sunk costs are unrecoverable expenditures which, by definition, cannot include outlays for the purchase of raw materials."
Your source for this definition please?
From the wikipedia article:
"In economics and in business decision-making, sunk costs are costs that have been incurred and which cannot be recovered to any significant degree. "
Such as the cost of gasoline on the wholesale market, that now is in the tank of a gasoline retailer. When deciding how to price this gasoline for retail sale, it is the current market conditions that matter more than anything, and not the price already paid. Those conditions include the prices posted by the competiton, and speculation about futures costs for the next tank.
Whatever your quibble may happen to be regarding the definiton of sunk cost, the price already paid for the tank of gas by the retailer will have little to do with how he will price his gas today. That was the central point, which you seemed to have missed. The cost of the gasoline already in the tank is *history*, water under the bridge. Rational businessmen look at current and future conditions. This fact effectively answers the question "so if the oil available today has been paid for "2″ years earlier, why does the consumer pay todays price? "
"Raw materials are processed into value-added products; the sales of these products allow the business to recover what it spent to purchase the raw materials."
Whether the costs already incurred on the raw materials can be recovered by the sale of the value added goods depends entirely on the market for those goods, and have nothing to do with the costs of the raw materials.
Whoever becomes "President" will have to play ball for the rich. Don't kid yourselves.
This BS has been going on for at least 30 years. Thirty years of waste and no responsibility.
"They" won't be happy until this once beautiful and proud country has been raped and totally rendered ugly. And yes they want your retirement funds and Social Security also. And they will get it!
"Their" job will be done when babyboomers kick their own buckets....a demand will be placed on the system and guess what folks..there will be nothing left !
Samson, like a horde of others here proclaims:
"Obama = McCain.
Either McKinney or Nader is the only way out of the mess."
Reality Warning: Neither McKinney or Nader will be president.
Then there is no way out of this mess. Let Delilah cut your hair, and go pull the temple down on yourself and end it all.
Got Metta___ You want to know why you should vote Republican?? Because of the important issues such as being against abortion and also birth control?, no stem cell research to save lives, no teaching of evolution in schools without matching it with the Bible story, no Social Security or Medicare, use of faith based welfare, pushing pre-emptive war with no end and use of torture, ending public education for private, etc.
Those are the type of issues that otherwise intelligent people depend on when they step in the voting booth and vote against their own best interests, thereby insuring more of the same; give to the rich and trample on the working people.
Savant -- my sense of personal responsibility tells me you're right. We are all responsible for the state of the country. We all need to be pushing for the changes we all know we so desperately need. But I feel I am facing a wall. Where do I push? What do I do? HOW do I take responsibility? Is this a child's question? Maybe so. I've lived on my own since I was 16, put myself through college and graduate school with scholarships and jobs, lots of jobs. I am not afraid to act. But when faced with the U.S. as it is now I am flooded with a sense of unreality, like I'm in Disneyland and I'm supposed to believe that the cartoons around me are real.
My husband and I covered our roof with solar panels, so that's one act. Fine. We have a veg garden. The rest of our yard is xeriscaped. We compost. We recycle everything. But it ISN'T ENOUGH. It ISN'T ENOUGH to be an example. We need to take more responsibility and we don't know how to do it. We both work very long hours (he's an engineer, I'm a novelist & poet) and don't know how to take the free time we have and use it effectively. Anyone out there, got some ideas? We agree that we need to push this vastly inertial Lump Of America in a new direction, and voting for Obama ain't the way to do it.
BUT WHAT IS? We honestly don't know. We would do more if we just knew what to do. It isn't enough to act alone.
Bush is correct - America's categorical collapse is totally the fault of Congress... for letting him play King instead of stopping the bastard when they had the chance.
Like any good drunk, he's blaming the liquor store, the beer makers, the hops growers, and the enablers - without all them, he'd be stone-cold sober, man.
You can't separate Bush from Congress on this.
The policies of Bush are all passed and approved by Congress. At the very least, the rules would have allowed 41 Senators to filibuster and block anything. They clearly chose not to do so. On the debt question, there is a debt ceiling set into US law that Congress periodically votes to raise to allow Bush to run up more debt. Much of the federal deficit is going to the Homeland Security dept that Congress insisted on creating, to pay the Pentagon budgets that Congress always passes almost unanimously and to pay for the wars which Congress votes regularly to fund.
Its a common Democratic trick to try to personalize it all on Bush or McCain. But that's not reality. Even with them, the key is the money behind them. And if you look closely, the money has switched to Obama this time around. Maplight.org has a widget that shows the total $$ to each candidate. Obama has raised the incredible sum of $295 million compared to McCain's $125 million. That's a switch from the last two where Bush was the one in the $300 million range.
Follow the money and learn the truth. Look at the money going to the Dems since they took control of congress, then connect the dots to the Dems making no changes in Bush policies once taking power. Then look at the money going to Obama and you can see the next dot in the line where he'll keep the same policies in place.
Obama = McCain.
Either McKinney or Nader is the only way out of the mess.
We are all to blame for the current state of this country. We can point the finger at Bush just like he can point the finger at congress, democrats, China...on and on we go. Is he partly at fault? Oh yea! This "war" won't end until we say enough is enough. (the US is technically not in a declared state of war with another foreign power, to my knowledge)
We do not push for alternative energy therefore we are addicted to fossil fuels
We do not push for federal recall therefore the power to impeach does not lie in our hands.
We do not push for an end to the war and the war economy therefore the "war" continues
We have the power. We have the ability. When will we implement it? Well, that's our decision.
Is it the republicans fault? In my opinion, yes. Is it the democrats fault? In my opinion, yes. Is it congresses fault? In my opinion, yes. Is it our faults? Definitely.
We need to get off the gas. It's only sending more of our money out the door. Solar power is cleaner, more efficient, with some refinements to the technology it can become cheap, and it is endless...for our needs anyway.
just my two cents.
jake newton has some learning to do.
Sunk costs are unrecoverable expenditures which, by definition, cannot include outlays for the purchase of raw materials.
Raw materials are processed into value-added products; the sales of these products allow the business to recover what it spent to purchase the raw materials.
You didn't think anyone was going to check that out, did you jake?
jj
Another thing is, the oil companies cannot charge more per gallon to a "franchised" dealer. They pay the same per gallon as the company owned stores in their areas. By company owned, I mean those convenience stores with major brand gas signs like Exxon, Texaco, Etc. Which actually means little, as the company owned stores are makng a killing, as it's just on "paper" for what they say they are paying for it. It's THEIR gasoline, THEIR stores.
Then the Circle-K type of convenience market/gas stations pay a lot less and they often just price one or two cents a gallon below the local major brand competition. So they also make a ton on gas. Their sales price depends upon their specific geographical location, they may be a nickel or dime less than a nearby major brand station.
War is peace
Poverty is wealth
words mean what the memory hole says they mean
Crude is down but the pump price is up
When the pump is down Hummers will be up
Deja vu, back to Ronald Raygun's 1970's when 'trickle down' was GeO Pee on the public.
~JAKENEWTON~ You say the gas station managers set the price. ____ Not entirely so ~JAKE~.
If the station is run by a "franchised dealer" that is correct and it's also correct if the station property is owned by the dealer, which any more except in rural areas, are few and far between. The majority of the major brand stations are now company owned and they hire managers to manage them, but those managers do not determine the selling price, the oil companies do.
And if it's a Circle K, a Stop and Go, etc, convenience market, those are also company owned and those companies determne the daily sales price, not their hired managers.
And no one has a contract at a pre-set price, the price of gasoline varies by the day, It may go up two cent at midnight, or drop by two cents at midnight. It may stay at any price for days, or even weeks. Normally it will change at least once a week, which mostly is based upon the price of crude.
If you were a franchise dealer for Exxon, Chevron, or Texaco, Shell for examples, you would pay more per gallon than what a Circle-K or a no-name brand station would pay.
The no-namers and convenience markets like Circle-Ks often recieve loads of major brand gasoline, (uslually less the cleaning additives,) their broker buys the gas from whomever and trys to get the best deal. It's often ten or more cents a gallon less than what a Exxon franchise dealer has to pay.
One compay, Chevron, advertizes that you get better mileage with their gasoline. Thst is a fact, you will, but you pay a dime or more per gallon for it. However, at four bucks plus a gallon, if you get just one more mile per gallon fuel mileage, it's well worth the extra dime. Figure the math. Also the engine runs cleaner and you have less chances of dirty fuel injectors and throttle plates.
words are important:
Repugs = McCain
Bush = McCain
Nader = McCain
McKinney = McCain
You can't always get what you want. But if you try Barack, you just might find, you get what you need.
"the gasoline sold by the various companies is all sold at a similar price, with price at gas stations varying < 2% and rising and falling in tandem."
The close price you observe is simply evidence that gasoline is a commodity, not that there is a monopoly. The same is true for cigarettes, milk, bread, etc. Retail gasoline is one of the most competitive markets there is, and they only make a few cents on the gallon.
"all the companies have their separate oil fields, with different costs of extraction and refining.wouldnt we expect it to be different if this were a competetive business?"
Again, you seem not to grasp that crude oil ( a different market than retail gasoline BTW ) is bought and sold on a *global* market, with the price set on a minute by minute basis at any number of commodity exchanges. Given this fact, the notion that the costs of extraction are variable effects the profit margin, not the price obtained in the market.
"most gas available has been brought on previously agreed long term contracts, not on the daily market. so if the oil available today has been paid for "2″ years earlier, why does the consumer pay todays price? "
This argument ignores the idea of "sunk cost", and is a beginner's mistake. Go read the article about Sunk Cost on Wikipedia and get up to speed. Past costs have much less to do with prices today than current market conditions do.
"as the spot price fell from 146 to 136, my gas station price decreased from 4.05 to 4.02, surely a proportionate fall, and a fine example of the competitive market at work."
You must not have realized that it takes several weeks for crude price fluctuations, which are *much* more volatile than retail gasoline prices, to filter through to the retail market.
You have some reading to do.
if it looks like a duck, quacks like a duck, walks like a duck..... it is not a duck.
the gasoline sold by the various companies is all sold at a similar price, with price at gas stations varying < 2% and rising and falling in tandem. all the companies have their separate oil fields, with different costs of extraction and refining.wouldnt we expect it to be different if this were a competetive business?
most gas available has been brought on previously agreed long term contracts, not on the daily market. so if the oil available today has been paid for "2" years earlier, why does the consumer pay todays price? this is particularly relevant as these companies drill 1/3 of their oil, a national resource, at minimal cost, on public land.
in a disaster situation, small time capitalists are prevented from charging what the market will permit, but it seems that big firms can gross any profit- gouge - that is 'legitimate', since it is with our 'permission'.
as the spot price fell from 146 to 136, my gas station price decreased from 4.05 to 4.02, surely a proportionate fall, and a fine example of the competitive market at work.
i for one cannot see the difference between exon and aramco. sure looks like a monopoly too me.
"The state of debt IS an issue – how much is it and who holds it?"
Agreed but you can't divorce it from the many items bought with the debt, each of which are debatable. Families go in to debt to buy a hous all the time, often to a number of times their yearly income. Using this analogy the US is in debt for 65% of it's yearly income.
"With the Chinese holding much of it, they have some degree of leverage over the US, which has trade and national security implications."
There is and *interdependence* between the two countries. China has no interest in ruining us because they want to trade with us.
" There is also the cost of the debt service "
Obviously, as with the family that pays tend of thousands towards interest on the note for the house.
jakenewton July 16th, 2008 2:47 pm
"I wonder why you ignore congress"
Because the article was about Bush. I prefer to stay focused on the article. Congress has plenty to account for – even the "conservatives" have been anything but fiscally conservative.
"The state of debt itself is less an issue than what has been bought with the debt, which is debatable of course."
The state of debt IS an issue – how much is it and who holds it? With the Chinese holding much of it, they have some degree of leverage over the US, which has trade and national security implications. There is also the cost of the debt service – how much of the budget (and tax revenues) does it take each year, especially when the debt continually gets larger.
Finally there is the issue of what it has bought – which is indeed debatable. The current wars – is their cost counted in the current debt? What about the future obligations like health care for wounded veterans and replacement of worn out or destroyed equipment?
Our economy has become a Ponzi scheme – based on perpetual growth instead of sustainability.
Bush is a genius and all of us here are the dummies.
He's getting everything he wants.
He doesn't care about the 'economy' as defined in this article. His definition of a good economy is how much money his corporate elites get, and they get a lot. Just look at the oil company profits.
The president may be a failure as a national leader and a disgrace to basic principles of democracy and justice, but that was never his concern, like most sociopaths.
And the democrats won't even consider impeaching this immoral criminal?
Vote third party, don't support the corporate elite and their selected puppets like Obama and McCain.
peace and justice and more than just words, they require action.
"Twice in my adult lifetime there have been banking/housing crises, both during the term of two term Republican presidents (Reagan & Bush II)"
I wonder why you ignore congress.
"The national debit has tripled;"
It's about 65% of GDP. Post WWII, it was about 120%. The state of debt itself is less an issue than what has been bought with the debt, which is debatable of course.
This has been going on for 28 years. Bush is no different from Reagan and Clinton. Move on.
Twice in my adult lifetime there have been banking/housing crises, both during the term of two term Republican presidents (Reagan & Bush II). A mere coincidence? It is an article of faith to Republicans that reducing government oversight of business is universally good – just leave it to businesses to regulate themselves. Hire the fox to guard the henhouse and see what you get. Not that the Democrats are innocent, either.
Gas is $4 a gallon; heating oil is $5 a gallon
The stock market is in the toilet; so is the economy
The rich are richer; the middle class is poorer
The national debit has tripled; we've run eight straight years of deficits
More than 4000 American soldiers are dead; tens of thousands are maimed
The Army is exhausted; so is their equipment, which must be replaced
Our freedoms have been compromised; the country is an international pariah
Etc, etc…
Tell me again why I should vote Republican.
Re: Military Use of Oil [from WSJ-Online article):
In the year ended Sept. 30, the Defense Department spent, by its estimate, $13 billion on fuel amounting to 134 million barrels of oil for the year, up from 107 million barrels of oil in 2000. The wars in Afghanistan and Iraq led to a surge in fuel use in that period, according to the Defense Energy Support Center, a government agency that buys fuel from private-sector companies and supplies it to the armed forces.
The most recent figure is more than the entire nation of Sweden consumed in 2005. (Still, it adds up to less than 2% of daily U.S. consumption.)
http://www.skybuilt.com/pdfs/SkyBuilt_WSJ_Article_07.pdf
"Jake Newton - defender of Big Oil…"
In asking how they gouge us, I don't defend them. I just ask that the attack be substantiated.
"BTW, I was wrong about ..."
Very classy to admit the mistake. Now wise up about the monopoly stuff.
Jake Newton - defender of Big Oil…
Inhaled too many fumes, I guess.
BTW, I was wrong about the military consuming that much gas; while it is the largest by far user in the US it is only about 1.5% - I think I read the 50% somewhere and latched onto it. Still doesn't mean I'm not getting gouged.
Gasbuddy lists 12 stations near me ranging from 4.03 to 4.29.
And btw, the price of crude is down sharply the past two days. They just dicided to gouge us less for some reason and turned the price dials right?
"The oil companies might be - in name - separate companies, but they are acting as a monopoly."
Please explain, and be specific.
"The price of gas at the pumps is no different at any of the gas stations in my town,"
In my area they vary by twenty cents or more. Do you know how the manager of a gas station determines the price they put on the sign? They look at the other signs in the area, and decide if they will try to steal business or make a little more per gallon. They do this every day.
"A monopoly backed by a pliant government can certainly gouge you, whether you permit them or not. That's what we have in the oil industry here."
There is no monopoly, here is a list of dozens of oil companies:
http://en.wikipedia.org/wiki/List_of_petroleum_companies
"The military, which comsumes 50% of the oil used by America,"
LOL! You just made that up? Wise up.
Like he said, you have to keep saying "it" so people will finally hear you - the old "catapulting the propaganda" ruse. If he keeps telling us the economy is doing just great - keeping a straight face as he does so, he knows we'll soon forget how our money is already stretched so thin it doesn't cover half of what it used to, and that we're having to eat less and less in order to pay for those things we can't exist without.
You can be gouged when dealing with a monopoly. The oil companies might be - in name - separate companies, but they are acting as a monopoly. The price of gas at the pumps is no different at any of the gas stations in my town, in spite of the fact that they're all sporting different names.
Competition, what freaking competition?
jake - A monopoly backed by a pliant government can certainly gouge you, whether you permit them or not. That's what we have in the oil industry here. The military, which comsumes 50% of the oil used by America, will buy that oil regardless of price, gouging me and you and every other taxpayer without their permission. Unregulated free-market capitalism is not Democracy, it is a rigged game. And you will get gouged, just like in any other rigged game.
"Bush didn't say a word about oil companies gouging the consumer."
No one can gouge you without your permission.
"It's in Big Oil's interest to limit supply,"
Unless they do it so much, that the resulting price increase causes significant decreases in use. It would be in "Big Oil's" interest to find a sweet spot with high prices that would not cause that decrease. That's where thing's are interesting, on the margin's of such things.