Last week many of the largest U.S. oil companies released figures showing they have made record profits in the first quarter of 2001, “exceeding stockholders’ expectations” after lower gas prices (and, I’m assuming, lower profits) were the norm throughout the 1990s.
As I’ve said before, I’m a capitalist; free markets, free competition and business free of government regulation, price-fixing and control is the best economic success plan the world has ever known. Profit-driven economies fare much better than socialistic, state-controlled economies any day.
But what’s the deal with gas prices these days? How come they’re spiraling all of a sudden?
Yes, I know — each summer, prices spike because oil company execs know that more Americans are set to take vacations. As more of us take to the roads, naturally that means increased gas sales and I realize companies want to profit from that.
However, in light of the fact that economic activity in this country has fallen so sharply in the past several months, and in light of the fact that the Bush administration has made much political hay out of our diminished ability to provide for our own energy needs, I still wonder why prices have been allowed to spike so high, so quickly, without so much as a whisper from the White House.
Oil men or not, this should offend the sensibilities of both Bush and Cheney, so I can’t figure out why the White House isn’t doing more to curb this criminal escalation of prices.
Yes, criminal. Free market, yes, but let’s get real, here: There can be little doubt that there is widespread collusion within the oil industry to inflate prices across the board. And that would be a violation of existing anti-trust laws.
Not so, you say? Well, then ask yourself this: In our competition-driven capitalist society, there should be at least one company out there that wants all the business it can get. Such a company should be drastically cutting its prices, not matching its competitor’s prices, don’t you think?
Where is the logic for Mobil, Exxon, Shell, Amoco, and the others to all charge the same prices — other than to “control” the market by basically pledging to share in the profits equally? If everyone charges the same high prices, nobody suffers. And it’s obvious all gas stations are charging the same prices.
That’s collusion, folks.
Is there going to be some corporate memo floating around that actually says this? Of course not; but given the anecdotal and tangible evidence, any logical investigator can connect the dots.
Drivers already know what’s going on; how come Uncle Sam doesn’t?
Even more damning is that this conspiring comes at a time when Americans have already been getting boffed at the pump by OPEC for some time. It’s bad enough when nations who owe their very existence and survival to the U.S. military screw us; it’s worse when our own companies are doing it.
If these prices don’t come down and soon, any progress the administration made in curbing the recessionary and inflationary tendencies of the first quarter are going to disappear faster than friends of the Clintons.
The thing is, this economy of ours runs on fossil fuel, whether wacko environmentalists like Robert Redford like it or not.
A wide range of products from plastics to chemicals to autos themselves all require oil to manufacture. Besides getting hosed at the pumps, Americans will begin to get hosed at the retail stores, too, when manufacturers begin charging higher prices for their goods to compensate for the higher costs of making those products.
Here’s another oft-overlooked fact. Truckers truck most everything we buy from coast to coast; if prices for fuel don’t ease, they’ll have to charge more to haul stuff, and those costs will be passed on to you and me when we buy stuff.
The so-called global economy will also suffer, so imported goods will eventually be higher too.
None of this inflationary news is good for an administration already allegedly in the pocket of the oil companies — especially one that was saddled with a staggering economy when it took over the reins of power in January.
So really, there is a whole lot more to this than just “gas prices,” even though that is the most visible energy-related scam.
The laws are in place to punish oil companies for this; there is no need, as some have suggested, for tighter “controls” and more “regulation” on the industry. Those ideas, in and of themselves, would lead to higher prices, too, and we don’t need that.
The evidence abounds; the question is, what is the administration prepared to do about it?
Prices have not simply “gone up”; they have spiked in record amounts and in record time. OPEC can’t be blamed for this one; prices — following cartel production increases — had actually begun to fall over the past few months.
There is no excuse for $2- and $3-per-gallon gasoline in America. This isn’t Europe. And yet, that’s where we’re headed, the experts say. So what’s the deal, Washington? Does anyone care enough to find out?
You’d better, if you still want to be around in 2002 and 2004.