D&C Editorial Board - weapons for oil
The recent D&C Editorial Board op-ed strongly supporting a gas tax holiday cut sadly misses the point that cutting the gas tax is a cheap political stunt.
here is an open question to James Lawrence and crew- do any on you actually think that the temporary suspension of a gas tax will actually result in lower prices that will be passed on to consumers? That oil companies (distributers, those in the supply chain)Â will gladly pass on the savings out of the goodness of their hearts?
Seriously, the market supports what we are paying now so suppliers will find some excuse to absorb the tax cut into the price. Once again, what is the purpose of the corporation? Maximization of shareholder value.
So the faux arguments of “it will be passed on the the customer” are nonsense. Maybe a couple of fill ups will be lower but eventually the price will rise to fill the void.
Exile posted some arguments from others including Paul Krugman. - go back and reread them. Remember the plunging dollar is a causal of the rise in oil prices as well.
But back to the editorial - Did the D&C editorial board just come back from a trip to Fantasy Island?
President Bush must use his leverage as a military supplier and global economic engine to push these countries to increase production.
Hope is eternal I suppose unfortunately memories are short at the D&C. This assumes President - lowest approval rating ever - Bush - actually has leverage. Didn’t we go through something like this a few years ago and Bush said he was going to talk to the oil producers - How did that work out?
But how much do we want oil? Enough to toss toss gas on a fire? Hey I’ll trade you some advanced military weapons for oil. Advanced military weaponry is one of the few things America still makes and controls the price in dollars. Then there is the whole economic engine thing. As we transition to a service economy - where are purchases being made? China. Capital is flowing away from the U.S and into China. The dollar is cheap.
But back to leverage. Who has it and who doesn’t.
Saudi Arabia can say we will start trading oil in Euros instead of dollars - then what our economy really crash. China can say - hey you own us a lot of money and call in the debt. Please - the US has no leverage here.
Then there was this bit of brilliance as “the world” get dragged into the editorial.
This is a global conundrum. Gas prices in Germany are at $8 a gallon.
Yeah - Low dollar (1 euro = 1.6 dollars) but those freaking Europeans and their mass transit systems. Gasoline is not the driver of their economies as it is here.
Seems the D&C is looking for “feel good” over “function”. Gas tax cuts postpones the inevitable. dealing with a car centric culture.
We need to deal with Urban Sprawl, lack of mass transit, addiction to oil sooner rather than later.
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stlo7:
I agree with your general point about calls for a gas tax holiday being a political stunt. I do think, however, that there would be some relief for consumers. If oil companies and gasoline distributors can “fill the void” left by a tax reduction, why are gas prices lower in states with lower gasoline taxes? Krugman may be right regarding federal gas taxes, but a cut in state gas taxes would amount to a permanent, if artificial, reduction in prices.
I see you used this issue to take the obligatory swipes at George Bush. How about equal time? The Democrats want to promote efforts to slow global climate change. This requires lower emissions from cars. Thus, high prices for gasoline support that policy. But, oops, the Democrats don’t want to the price too high to really affect anybody. So they call for “action” to lower gas prices. Of course, they refuse to allow drilling for oil in the US or building more refineries here, “actions” that would actually help lower prices.
So it could be said that Bush and the GOP are wrong on gas prices but, in fairness, the Democrats are wrong and hypocrites on gas prices.
John -
I don’t know but I suspect it has to do with the distribution pricing. Something I’m not all that in tune with but from what I understand there are too many middlemen.
I believe the Dems are trying to address it in the State Assembly and House.
Look - more drilling does nothing for us. You can drop a well an ANWR today as you allude and it will be 10 plus years before oil is produced.
Refining is the key but you have to do better than blame the Dems of lack of refining. Have to show me how the Dems have blocked new refineries. Even if they did, I’m sure it pales in comparision to the oil companies taking them off line at inconvenient moments.
Now the obligatory swipe at Bush? A primary causal of the oil price spike is the falling dollar. Swipes at Bush are intended because when you take balanced budgets, surpluses and turn them in to economic weakness - well you reap what you sow,
We do agree on relief to consumers. Figure out some relief for truckers maybe - that would impacts things we purchase perhaps lower food prices. Whatever we do it can’t be a stunt. The stunt Hillary, McSame and Joe Robach are pitching.,
The 3 states with the lowest gas prices are:
1. Alaska
2. Wyoming
3. New Jersey
New Jersey? Yes. It’s easy when you look at the advantages the 3 states above have. And they can be summarized by New Jersey’s advantages.
The prices are lower in New Jersey for a variety of reasons, one being that many of the state’s 4,000 stations are independently owned and drive up competition, which drops prices. Another is that New Jersey is flush with refineries and gasoline infrastructure like fuel pipelines and deep harbors to import petroleum from around the world.
But probably the biggest reason is that New Jersey has the nation’s third-lowest gasoline tax, at 14.5 cents a gallon, and it hasn’t gone up in almost two decades.
New Jersey is the fourth largest oil-producing state in the nation, according to the New Jersey Petroleum Council. It also has two major pipelines plus New York Harbor and Delaware Bay, which take in millions of gallons of crude oil from overseas. Money saved from not having far to ship gas is reflected in prices.
It seems that a lot of the agonizing over gas prices and what to do about them misses the point. There’s really no going back. Gasoline prices in the US are not so much experiencing some catastrophic, conspiracy-driven surge out of control as they are undergoing a long overdue adjustment. We’ve been lucky to have had cheap gasoline for so long. Gas tax holiday pacifier aside, its a fantasy to imagine that there’s a government mechanism available to lower prices or to stop their increase. Greater emphasis should be placed on getting people to realize that the genie is out of the bottle and there’s no getting him back in. So now, let’s hear what the plans are for helping us to adjust to increased costs rather than trying to hypnotize us into imagining the price will go back down.
The hardest thing any politician has to do is to ask Americans to sacrifice. The most important thing a leader has to do is tell us we must.
Americans are silly and dumb. They pay more for bottled water than they do for gas, and only complain about the gas.
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