I find this line of reasoning--we'd better extend special tax breaks to the oil companies so they will sell us cheap gas--to be laughable. What's next? Should we enact special tax incentives to automakers so we can have cheaper cars? Maybe a special tax incentive to bakeries so the American public can enjoy cheaper doughnuts? Or how about a special tax break to professional sports team owners so a night at the ballpark with the family might not be so expensive?

 

They all sound like great ideas to me, after all we can just keep putting the cost of government on credit...

I find this line of reasoning--we'd better extend special tax breaks to the oil companies so they will sell us cheap gas--to be laughable. What's next? Should we enact special tax incentives to automakers so we can have cheaper cars? Maybe a special tax incentive to bakeries so the American public can enjoy cheaper doughnuts? Or how about a special tax break to professional sports team owners so a night at the ballpark with the family might not be so expensive?

 

They all sound like great ideas to me, after all we can just keep putting the cost of government on credit...

With all of the tax breaks they get now look at how we pay for it.(3.40 today in Zanesville,Ohio)

I find this line of reasoning--we'd better extend special tax breaks to the oil companies so they will sell us cheap gas--to be laughable. What's next? Should we enact special tax incentives to automakers so we can have cheaper cars? Maybe a special tax incentive to bakeries so the American public can enjoy cheaper doughnuts? Or how about a special tax break to professional sports team owners so a night at the ballpark with the family might not be so expensive?

 

They all sound like great ideas to me, after all we can just keep putting the cost of government on credit...

I find the line of reasoning that imposing higher taxes on any product or industry will benefit consumers to be laughable. The obvious short term (in terms of the next few decades) solution to rapidly escalating oil prices is to increase the supply of oil on the market. Until liberals are willing to admit that obvious fact, politicians will continue to demonize oil companies to divert attention from their own massive failures to provide real solutions to the problem.

 

So far, nobody who supports paying higher prices at the pumps has offered an example in the real world where imposing punitive taxes has resulted in lowering a product's price...and that is the acid test for the ridiculous proposals that are being forwarded by Senators Obama and Clinton.

Oil closed at $112/bbl yesterday. The average price of oil in 2002 was $23. That's an almost 5 fold increase.

Oil closed at $112/bbl yesterday. The average price of oil in 2002 was $23. That's an almost 5 fold increase.

 

It seems to me that some of the reasoning for our work in Iraq was that we were there to make the area more stable and to protect our oil supply. Yet it seems we are looking at higher prices than we ever faced before the Iraqi invasion. I'm just curious as to what we have really accomplished there if oil is 5 times more with no end in sight than before. Is it just the Chinese have increased consumption 5 times in that time frame or is it something more? Any ideas?

It seems to me that some of the reasoning for our work in Iraq was that we were there to make the area more stable and to protect our oil supply. Yet it seems we are looking at higher prices than we ever faced before the Iraqi invasion. I'm just curious as to what we have really accomplished there if oil is 5 times more with no end in sight than before. Is it just the Chinese have increased consumption 5 times in that time frame or is it something more? Any ideas?

Prices are set by market forces and really have nothing to do with consumption levels. If the world has a 1% over supply and the developing countries increase consumption beyond the ability of the oil producers to meet the demand, then a supply shortage results in rapid price increases until demand decreases to meet the available supply.

 

Relatively small changes in the amount of oil on the market can have large impacts on prices. That is why the failure to drill for oil in a small portion of the Arctic National Wildlife Refuge (and other so-called "pristine" areas) is one of the worst policy failures by Congress in the history of this nation.

Since 2000, China's consumption has risen from 4,772,000 bbl/day to 6,988,000 bbl/day in 2005. Of the worldwide increase in consumption of oil in 2008, 25% is expected to be attributable to China.

Prices are set by market forces and really have nothing to do with consumption levels. If the world has a 1% over supply and the developing countries increase consumption beyond the ability of the oil producers to meet the demand, then a supply shortage results in rapid price increases until demand decreases to meet the available supply.

 

Relatively small changes in the amount of oil on the market can have large impacts on prices. That is why the failure to drill for oil in a small portion of the Arctic National Wildlife Refuge (and other so-called "pristine" areas) is one of the worst policy failures by Congress in the history of this nation.

 

 

Thanks.

I find the line of reasoning that imposing higher taxes on any product or industry will benefit consumers to be laughable. The obvious short term (in terms of the next few decades) solution to rapidly escalating oil prices is to increase the supply of oil on the market. Until liberals are willing to admit that obvious fact, politicians will continue to demonize oil companies to divert attention from their own massive failures to provide real solutions to the problem.

 

So far, nobody who supports paying higher prices at the pumps has offered an example in the real world where imposing punitive taxes has resulted in lowering a product's price...and that is the acid test for the ridiculous proposals that are being forwarded by Senators Obama and Clinton.

 

 

You seem to be perfectly willing to take on faith that if tax breaks with no strings attached are handed to an industry they will, out of the goodness of their hearts, use the windfall to fund projects that will lower the price of their products to consumers and that the economic benefit will outweigh the lost tax revenue. This seems incredibly naive. To my way of thinking, the consumer does not really benefit if a tax break results in $10 billion in lower fuel costs, but reduces tax revenue by $20 billion. The consumer (you, me, our kids) will end up paying for the $20 billion ultimately (with interest). But that fact always seems to be lost on people who advocate blindly cutting taxes before cutting spending.

 

And suggestions that the real solution is increasing supply are just plain silly. We all know that demand for petroleum continues to far outpace supply and that eventually (maybe not many years from now) oil production will plateau because the extractable oil reserves are limited and increasing at a much lower rate than consumption. Temporarily adding more oil supply to the world market just delays the pain into the future, and weakens economic incentives for conservation and the development of alternative energy sources. Most people would agree that the proper way to treat a person with a gluttonous appetite is not to shove another banana split into their face and say, "here, enjoy, we'll tackle your eating disorder tomorrow".

If you believe what they the R'S or the D'S say they are going to do for the AMERICAN voter then you are as blind as they hoped you would be.

Nope, not at all. But so many want to blame Bush, so I thought I'd remind everyone of that little bit of info. The govt doesn't control gas prices, yet some like to blame GWB.

You seem to be perfectly willing to take on faith that if tax breaks with no strings attached are handed to an industry they will, out of the goodness of their hearts, use the windfall to fund projects that will lower the price of their products to consumers and that the economic benefit will outweigh the lost tax revenue. This seems incredibly naive. To my way of thinking, the consumer does not really benefit if a tax break results in $10 billion in lower fuel costs, but reduces tax revenue by $20 billion. The consumer (you, me, our kids) will end up paying for the $20 billion ultimately (with interest). But that fact always seems to be lost on people who advocate blindly cutting taxes before cutting spending.

 

And suggestions that the real solution is increasing supply are just plain silly. We all know that demand for petroleum continues to far outpace supply and that eventually (maybe not many years from now) oil production will plateau because the extractable oil reserves are limited and increasing at a much lower rate than consumption. Temporarily adding more oil supply to the world market just delays the pain into the future, and weakens economic incentives for conservation and the development of alternative energy sources. Most people would agree that the proper way to treat a person with a gluttonous appetite is not to shove another banana split into their face and say, "here, enjoy, we'll tackle your eating disorder tomorrow".

 

And of course the implicit assumption of your post is that the government is going to manage the $20 billion tax revenue in some meaningful and beneficial way that the corporations wouldn't.

 

If the choice is giving $10 billion in reduced gas prices directly to the consumer or $20 billion tax revenue to the feds, I'll take blind faith in the corporations over blind faith in the federal treasury any day and twice on Sunday.

And of course the implicit assumption of your post is that the government is going to manage the $20 billion tax revenue in some meaningful and beneficial way that the corporations wouldn't.

 

If the choice is giving $10 billion in reduced gas prices directly to the consumer or $20 billion tax revenue to the feds, I'll take blind faith in the corporations over blind faith in the federal treasury any day and twice on Sunday.

 

You're missing the point. It's not "who will manage the money more effectively". This is not a big government vs. small government question. It's not even a big government vs. big corporation question. It is a "how do we pay for the government we have" question. I know there is contempt for the Federal government among the far right. The problem is that this contempt is often manifest as a burning desire to rampantly cut taxes with little regard for the consequences. It would be infinitely better if that passion were expressed as a loud and clear voice from the right to reign in spending. Unfortunately, I don't hear that voice, so we have to pay for the government we have.

 

You may think you're getting away with something by pocketing the $10 billion today, but you can't escape that $20 billion liability that gets recorded and doesn't go away because we don't want to think about it.

You seem to be perfectly willing to take on faith that if tax breaks with no strings attached are handed to an industry they will, out of the goodness of their hearts, use the windfall to fund projects that will lower the price of their products to consumers and that the economic benefit will outweigh the lost tax revenue. This seems incredibly naive. To my way of thinking, the consumer does not really benefit if a tax break results in $10 billion in lower fuel costs, but reduces tax revenue by $20 billion. The consumer (you, me, our kids) will end up paying for the $20 billion ultimately (with interest). But that fact always seems to be lost on people who advocate blindly cutting taxes before cutting spending.

 

And suggestions that the real solution is increasing supply are just plain silly. We all know that demand for petroleum continues to far outpace supply and that eventually (maybe not many years from now) oil production will plateau because the extractable oil reserves are limited and increasing at a much lower rate than consumption. Temporarily adding more oil supply to the world market just delays the pain into the future, and weakens economic incentives for conservation and the development of alternative energy sources. Most people would agree that the proper way to treat a person with a gluttonous appetite is not to shove another banana split into their face and say, "here, enjoy, we'll tackle your eating disorder tomorrow".

Oil companies have a history of investing in alternative energy sources. Big oil gobbled up coal companies by the dozens during the oil crisis of the 1970's to hedge their bets and they invested heavily in those companies.

 

Eventually, oil prices plummeted after Reagan took office and cut taxes and most big oil companies reduced their holdings in coal or exited the industry altogether. I know this because I once worked for a subsidiary of Occidental Petroleum. The mergers and acquisitions occurred not "out of the goodness of their hearts" but because those investments made business sense at the time.

 

At current prices, gasoline and other refined petroleum products can be produced profitably from coal. The problem is that China, which has large coal reserves of its own, already has synthetic fuel plants in the works. The risk that the bottom will drop out of the oil market if synthetic fuels suddenly flood the market is a real one. The companies that jumped the gun in the 1970's and invested in alternative fuels, convinced that there was actually an oil shortage, were burned when the market changed.

 

Because politicians have demonized the oil industry to such a large extent, makes future bail-outs unlikely if companies make risky investments in alternative fuels that result in a sharp drop in gasoline prices. However, if the government wants to insert itself into the market, we would be better off if it did so in a way that would encourage the development of alternative fuels that could be placed on the market at affordable prices in a reasonable timeframe.

 

Of course, as long as Al Gore and the anthrocentric global warming hucksters have their way, no alternative fossil fuels will be substituted for oil and prices will continue to spiral upward and out of control.

And of course the implicit assumption of your post is that the government is going to manage the $20 billion tax revenue in some meaningful and beneficial way that the corporations wouldn't.

 

If the choice is giving $10 billion in reduced gas prices directly to the consumer or $20 billion tax revenue to the feds, I'll take blind faith in the corporations over blind faith in the federal treasury any day and twice on Sunday.

:thumb: When faced with the choice of putting more money in the hands of private business and consumers and the federal government, there is no choice to be made.:lol:

Nope, not at all. But so many want to blame Bush, so I thought I'd remind everyone of that little bit of info. The govt doesn't control gas prices, yet some like to blame GWB.

Not to get into a war of words on this topic but his hand is as dirty as they get when it comes to oil.