So you were against a NASA program too? I mean really...nothing worse than a bunch of inventors and researchers. Sheesh
Gas hikes cost up to $20 billion GAO tells Congress that the record levels have burned up $20 billion Reuters Updated: 1:52 a.m. PT May 23, 2007 WASHINGTON - The jump in U.S. gasoline prices this year has so far drained consumers of an extra $20 billion, or about $146 for each passenger car in the country, the Government Accountability Office told Congress on Tuesday. The national price for regular unleaded gasoline hit a record $3.22 a gallon this week, and is up $1.05 since the beginning of February, according to the Energy Department. The added expense is taking money away from consumers to spend on other goods and services. "Spending billions more on gasoline constrains consumers' budgets, leaving less money available for other purchases," GAO's Thomas McCool said in written testimony to a House Oversight and Investigations Subcommittee hearing on the cause of record prices. Like many other energy experts, McCool said the GAO has found that current high pump costs are the result of a large amount of oil refining capacity being offline, strong gasoline demand and lower fuel inventories. Many lawmakers blame the lack of competition in the oil industry from mega oil company mergers for the run-up in gasoline prices. McCool said company mergers in the 1990s caused wholesale gasoline prices to rise during that period, but the agency has not performed modeling on mergers that occurred since 2000 and therefore could not say what the effect has been on current fuel prices. However, he said, "These mergers would further increase market concentration nationwide since there are now fewer oil companies." Officials from oil giants Exxon Mobil, Chevron and Shell Oil, along with major oil refiner Valero Energy Corp., were asked to testify at the hearing but declined to appear. Federal Trade Commission member William Kovacic said his agency was closely monitoring the U.S. gasoline market for any unusual moves in prices. "Because gasoline consumers typically do not reduce their purchases substantially in response to price increases, they are vulnerable to substantial price increases," he said. Speaking to reporters before the hearing, he declined to comment on whether the FTC has found any evidence in the current price rise of oil companies overcharging consumers. Kovacic said in his written testimony that the "lion's share" of the increase in pump prices appears to be attributable to refinery outages, higher gasoline use and lower fuel imports. He said the FTC's experience from past investigations and from its current monitoring program shows that unusual movements in gasoline prices "typically have a business-related cause," such as changes in crude oil costs, refinery problems or pipeline disruptions. Oil companies have pointed out that more than 30 prior government investigations into alleged gasoline profiteering has proven the industry did nothing illegal. Rep. Bart Stupak, the chairman of the subcommittee, said the FTC needs more authority to punish oil companies that gouge drivers at the pump. A bill he has introduced that would give the agency that authority, which has support from over 120 lawmakers, is scheduled to be voted Wednesday by the House of Representatives.
The short term gasoline price issue is clearly related to refinery capacity. The crack spread has been at historic levels, so unleaded is being driven by more than just high crude prices. The obvious solution would be to build more refineries, but who in their right mind would do that? The existing refiners are printing money. Congress is full of talk of punitive legislation. why invest in a business that is being targeted by economic illiterates in congress? Moreover, mandates for everything from carbon reduction to alternative fuels add tremendous uncertainty to the investment decision. There is a certain irony in the current situation. Some of the very liberals who want to enact carbon taxes to reduce energy useage are screaming bloody murder because the market has accomplished the same thing.
Carbon energy usage is down worldwide? I don't think so... Everyone seems to be missing the point though...30 years later and no progress. If we get another terrorist attack, everyone will go ballistic and we could see a near police state overnight, change will happen quickly...but we have had 30 years to do something about dependency on "Arab" oil and we did nothing?
An attempt was made in the '70's following the OPEC embargo to sue them under US antitrust laws for price fixing. The case was brought by the Machinists Union and ended up being decided by the Supreme Court. The Court's basic holding was that exploiting natural resources was a sovereign function and hence the OPEC countries were immune from suit. It is this holding that the legislation discussed in the opening post is designed to overturn. The holding is interesting in that it can be said to be one of the first instances in which the Court imported foreign legal concepts and applied them in a US case. This subject has become extremely controversial recently, as the Court's liberal members have quoted foreign decisions on subjects such as executing minors and given them weight as persuasive authority. Clearly in the US natural resource exploitation is not regarded as a sovereign function. The government can enact laws regulating it, but the activity itself is purely commercial. Not so for OPEC, which regards the issue as sovereign. The legislation is a waste of time. Any judgment that is achieved will be ignored, and enforcement efforts will create a foreign policy nightmare. If we are really determined to break OPEC, we should skip the 10 years or so that would be wasted in lawsuits and go directly to diplomatic or military action. We had the perfect opportunity to do that with both Kuwait and Iraq. We could have conditioned our ejection of Iraq from Kuwait upon Kuwait agreeing to withdraw from OPEC. For that matter, we could have pressured Saudi Arabia to withdraw from OPEC, since they were totally vulnerable to Iraq and in no position to refuse. Similarly, after the Iraq invasion, we could have positioned Iraq as a non-OPEC producer. Watching a country with Iraq's capacity produce full tilt would have likely driven at least some of the other OPEC members to do the same. Instead, Bush 41 and 43 both meekly allowed OPEC to continue to have a stranglehold on production, only with the US military as its mercenary security force.
There is not, nor has there ever been a shortage of oil. There is a shortage of refining capacity. This is intentional. Big oil has used environmentalists as useful idiots/scapegoats for 30+ years. Truth is, they(big oil), have no interest in building more refineries. Less capacity = more profits. Simple! Exxon alone made nearly 400 billion in profits last year. A new refinery in todays dollars would cost about 5-7 billion. In other words, about a weeks profit. Instead they used the bulk of their profits buying back stock and paying dividends to shareholders. The only way to offset the price at the pump is to be an investor in big oil, and then short the pricks when times get tough for them. Other than that, they hold all the cards.
americans love to take it up the asses. don't you know that anal sex is the favorite position among most gringos and gwailos.
The only thing that would really solve it would be to reduce demand to where its a demand constrained buyer's market instead of a supply constrained sellers market. The way to kill 3 birds with 1 stone was to tax fuel usage, use the money to eliminate the budget deficit, and reduce the trade deficit as a consequence. Of course the reduction in demand would also force the price of the oil itself lower, too. Another way to do it instead of a tax is simply to allow the world to go into recession or depression. That method has been very effective, every time its been used. People without jobs and without money don't buy a lot of fuel. Its a shame that this method is a lot more painful than a fuel tax would be. We proved we learned absolutely nothing in 30 years, IMO.