Letters to the Editor
mattwa33186
Published Letters: 432 Editor's Choice: 45
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Plenty of blame to go around
[Read the article: Black gas-price Monday?]
[Read more letters about this article: Here]I have worked in the oil industry, and there are many things wrong with how this industry is run and allowed to run.
It's true, as a previous poster stated, that margins at the pump are much thinner than many people think, but they are also not quite so thin as he would like us to believe. Many states have laws against oil companies operating gas stations, in order to ensure the type of cut-throat competition alluded to in that post, but they are constantly circumvented through the use of holding companies - oil companies have huge staffs of lawyers to outwit the legislatures. Typically, company operated gas stations participate in a sort of unspoken collusion where they will match each other's prices - increasing their margins and leaving room for independents who buy their gas to make plenty of money. Company operated stations ignore the prices at independents when determining what to charge, partly so they aren't competing with their customers but mostly because it lets them set the market high. Independents want to be 1 cent cheaper than their competitors (who are no more than a mile and a half away in most cases). Company run stations want to maintain revenues and throughput. So the corporate Exxon/Mobil station on the corner might be just fine with charging 4 cents more than the independent up the street, and that means less price pressure on all gas retailers in the area.
We are largely to blame. We do drive too much, and we haven't stopped buying gas guzzlers. We are responsible for the demand.
But what about the supply? Remember when the price of antifreeze increased by about 300% in the late 80's? Texaco lost an antifreeze production site in Louisiana, one of only 3 in the country. Antifreeze had been being sold pretty much at cost until that point, so the price increase was actually warranted to a large degree. But what the oil companies learned was that Americans would accept them altering the supply, and that's the problem. Big oil now uses any excuse they can to cut production at the refinery. This is the problem when critical utilities control production and a large percentage of retail without any real government oversight.
The fix is not to break up the monopolies, necessarily, but to treat them as monopolies. Higher prices are good in many ways, but a tax that goes directly into corporate pockets isn't. And this puts no pressure on the oil companies to develop alternatives, which is critical if we want to be able to distribute those alternatives once we have them.
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Yes, there are valid reasons
[Read the article: Black gas-price Monday?]
[Read more letters about this article: Here]from an economic standpoint. Inventories are dropping, which always produces an increase in price.
But who controls the inventory levels? That, my friend, is the rub. The people who stand to make the most off the commodity are the ones who set the entire market. The consumer has very little to say in the matter of pricing, since the vast majority of gasoline is burned by people who have no choice. The big oil companies control the product from end to end.
Oil companies report what they want in terms of earnings, like any corporation. Sandbagging the numbers is an age old tradition. They first claim that prices are rising because they haven't invested in physical plant which results in lower inventories, then claim razor thin margins because of the cost of investment in physical plant. Profits are an abstraction, and they decide how much they want to share with the shareholders.
Treat them as a protected monopoly, like any utility, because that's what they are and always have been. Regulate pricing, and force them to invest in development of alternative fuels if they want to continue selling their commodity. This is not a free market problem, because oil in this country has never been subject to market forces.
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Typical
[Read the article: Bill Clinton explains immigration]
[Read more letters about this article: Here]Typical rhetoric from the hero of one of our so-called parties - so-called because they have completely lost track of anything resembling the ideologies they are supposed to represent, true of every party except the Libertarians who are merely inept.
Advice on dealing with poverty on a global level from a man who's first considered act as an ex-President, after being told that asking the taxpayers to pay millions in rent to give him offices in the WTC would be bad for Hillary's presidential aspirations, was to destroy a large percentage of the small businesses in Harlem by putting his offices there - instantly driving rents through the roof.
Most immigrants, the poor ones, don't come here because we are the land of opportunity, not any more. And they don't come here because we are a bastion of liberty, because we aren't any more. They come here for the social programs, and we can't and will never be able to afford to take enough people in to stop wars or end suffering as long as they are in place. That's the reality of the situation, and BC doesn't grasp it.
If he really wants to help the world's poor, he'll push for us to return to where we were before the Great Society, when an honest, hard working immigrant could give his children a good life. The last thing we need is a World Bank president who thinks we can solve all the world's problems with government cheese and housing projects.
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...?
[Read the article: Iraq: Not so open for business, any more]
[Read more letters about this article: Here]If you are pointing out that big business understands that the odds of Iraq ever having a stable government that is not led by a Famous Religious Fanatic That Hates America are quickly approaching zero, I agree.
Or if your point is that big business believes that we are not going to be able to extricate ourselves from this mess for quite a while, that the war will go on for years, and they are adhering to the maxim of not investing in things that are likely to get blown up or siezed by the locals, I also agree.
Other than that, I'm not sure what your point might be.