Friday, April 28, 2006

I feel like I'm taking crazy pills

Will Ferrell said this in the 2001 comedy "Zoolander." For those of you not in the know, Will was playing a fashion mogul plotting against the PM of Malaysia (stay with me). Ben Stiller was this airheaded male model who had multiple "looks" - except they were the same pout every time. An exasperated Will finally loses it at the end, shouting at the people around him, did they not realize this? And that, yes, he felt like he was taking crazy pills.

Funny in Zoolander. Not so funny with regard to the flap over the price of gas, in the event you're feeling like I am, the last sane person in a world gone mad.

It seems that both Democrats and Republicans are both falling all over themselves to denounce something as American as... making a profit. Yes, imagine that! So the chorus in Washington (did I mention this is an election year?) is that Big Oil is bad, they're apparently somehow "gouging" people, and that Congress must do something about it. I would respectfully ask that if they must do something, it might be 1) take a long vacation, 2) consider spinal-implant surgery, or 3) take a class in economics.

Funny thing about the price of oil - it's awfully hard to manipulate it. Years ago OPEC nations decided to collude on the price of oil, in an attempt to maximize profits. To do so, they had to agree on production quotas - simply put, hold supply down, and even unchanged demand will cause prices to rise. Problem was, with increasing prices per barrel, producers cheated and produced more barrels (thinking they were the only ones doing that). With supply increasing, prices naturally came down, despite the cartel's best efforts.

Here's the deal. Gas prices are related to oil prices. Oil prices are determined by global supply and global demand. As global demand increases (think China and India), oil prices are going to go up. So will gas prices.

But so will production. Exxon made billions in profit last year, but also invested billions in exploration and R&D. They're in the business of finding, refining and selling oil products. That they're really good at it is no reason to get hysterical, and all of those spinally-challenged mouthpieces in Washington ought to be ashamed of themselves. That they think so little of the American people ought to be reason enough to throw the bums out.

That this is also coming from Republicans is another reason why I no longer identify myself as such. To anyone who might agree with what I'm saying, consider defining yourself thusly: I am a conservative. Say it with me. There, doesn't that feel better?

1 comment:

Mike said...

Heard a good comment on the radio. Given the high salaries of baseball players, and the resulting high prices for tickets, isn't it about time that Congress investigate Major League Baseball? Sarcasm aside, the economics are still the same. The price for major league quality baseball is what it is. The price for minor league quality baseball is what it is. Not a tough concept unless you're in Congress.