Solution to gas prices: Nationalization

"F.H." wrote in news:wz55i.13826$qp5.3773@trnddc03:

I'm afraid that, quite honestly, I'm not following your connection. Can you elaborate for me? Not kidding here.

Laissez faire is often used to describe Reaganomics supply side theory, "a rising tide lifts all boats," etc.,etc.. The evidence suggests otherwise. It should say *some* boats. ;)

As for "Venezuela always being so poor" *always* is a long time. Some people claim that offers of help in the form of loans have been part of the problem, that borrowing from the World Bank can turn out to be like borrowing from the Mafia. ;) And like with the Mafia, people can wind up dead. Try the New York Times bestseller, Confessions of an Economic Hit Man, it might change your perspective a tad on poverty in some South American countries.

I won't comment on their profits. But, every so often, a spokesman for one oil company or another will be quoted on the news, explaining the reasons for the most recent round of price hikes, and some of the reasons are insulting to listen to. That's the problem for me.

I think the president could help by getting his comedy writers together and coming up with a speech which explains why it's good for "the economy" when gas prices continue to climb.

"F.H." wrote in news:iF75i.13858$qp5.6019@trnddc03:

Heres another term for you: "red herring".

You can give any old name you like to things, but just any old name is not always going to be accurate. Reagans' economic policies may be more accurately described as "less mecantilist" than some of the other presidents'. It was certainly not "laissez faire".

Another example of an inaccurate term affecting people's view of a subject: When California and the Canadian province of Ontario altered their regulatory framework for electricity, it was instantly dubbed "deregulation", even though the market remained heavily regulated in a slightly different manner than before. The term was inaccurately used, but you'd never have known that from what you read in the papers.

The indisputable fact is that people are never richer as when their governments leave them alone. The best things a government can do for its population are

1) to recognize and support private property rights, 2) to provide a fair and honest dispute resolution system, 3) to obey its own rules, 4) and to otherwise go away.

Nothing. Off you go then.

That works when most of your oil is sold to others (USA) at a high enough price to cover the give away. Someone said Chavez inherited his oil industry, no he stole it off the backs of international oil companies who built it. In his defense he is using some of the excess oil profits to help his people and those of friendly neighbors, but he is doing nothing for the industry and productivity of his country.

He's just a dictator having a verbal battle with dictator Bush.

There's cheap gas in Iraq too. GO GET IT!

You should call this to the attention of all the right wing economists then. I'm sure they would appreciate the warning against any form of misusing words to convey their own special propaganda. I don't repeat war slogans, just economic ones. ;)

Reagan really *did* start the deregulation craze. Not long thereafter the taxpayers bailed out the Savings and Loans (but not before some Bush family members made off with with some chump change). Then they deregulated electricity. Not like Canada's. Real deregulation. Ever heard of Enron?

*Some* people. And the richer they get, the more influence they can buy. The more influence they can buy...........

Absolutely.

Hold fast to dreams For if dreams die Life is a broken-winged bird That cannot fly.

Hold fast to dreams For when dreams go Life is a barren field Frozen with snow

"F.H." wrote in news:tLn5i.8433$TU1.5106@trnddc07:

No, Jimmy Carter did. You could look it up. And in any case, it never even came close to being "laissez faire". Not even remotely.

There are more regulations and government administrations now than ever before in US or Canadian history. So much for "deregulation".

That isn't "laissez faire". that's mercantilist.

Also I seem to recall tax law changes gave rise to the S&L debacle in the first place.

They most certainly did NOT.

California and Ontario did much the same thing when they re-regulated. Enron gamed the Ontario market as well as California's.

ALL people. Every single one without ever an exception.

In a truly "laissez faire" environment, the government would not be in a position to dispense largesse to lobbyists.

The reason lobbyists are so thick upon the ground is because there is either

1) something to be gained by bending the government's ear, or 2) they want preferential absolution from restrictions imposed by the government.

Dreams are your business, not the business of those whose job it is to run the courts and keep the roads paved.

As soon as the government gets involved in "dreams", the lobbyists are in there trying to get some advantage for themselves.

Seems you have built up a considerable personal investment in this topic. Perhaps fantasy is a better word than dream but I think you got my drift. I have a hard time vigorously championing anything thats never been before. No way to gage it. Kind of like heaven. Sounds good. Sounds better to some than others. ;)

There are usually good reasons things never get out of the fantasy/dream stage. In this case the number one suspect seems to be human nature.

Don't make it bad to fantasize/dream but windmills can grab ya and throw ya. Is it true that Senor Quixote spent a lot of time alone and had many bruises.

"F.H." wrote in news:hcq5i.5479$Ud7.4483@trnddc08:

You got it. That's why we'll forevermore see mercantilism, protectionism, favoritism and lobbying, and not "laissez faire".

We've come close to "laissez faire" a few times, notably Hong Kong under Cowperthwaite, and prety much the entire industrialized world in the few decades prior to World War 1.

Our current widespread prosperity is largely due to the afterglow from the pre-WW1 era: Private property rights, innocent-until-proven-guilty, that sort of thing.

I partial to the afterglow between Roosevelt and Reagan. When the wheels come off of this current "widespread prosperity" it is going to be ugly. Very ugly. But then again, if its done slow enough people just keep adjusting and before ya know it there will be a new norm.

We'll no longer have families where both adults work to make ends meet. We'll just morph into families where no one ever leaves and all contribute from their minimum wage jobs to support the family SUV. ;)

Gasoline has always been cheap there. Premium was equivalent to about $0.30 per gallon when I lived there years ago. (There were three grades of gasoline then, and the cheap one was about $0.07 per gallon, IIRC) This does not represent any world economy prices, but is a bone thrown to the people.

Hugo Chavez is a bit left of socialist. He is moving toward communism as quickly as he can, but still calls it socialism. (There is a BIG difference)

The currency today is about Bs2000 to the dollar (roughly) but you can easily get Bs 3500 for your dollars on the black market, maybe even 5000. When I lived there it was Bs 4.27 to one US dollar.

Indeed, but you wouldn't know it from the media portrayal stateside.

Interesting.

In message news:oi07i.9386$ snipped-for-privacy@news02.roc.ny, JoeSpareBedroom sprach forth the following:

Which is why there are exactly three "front-runners" for the Democratic and Republican nominations, even though not a single vote has been cast, and despite the fact that Ron Paul wins EVERY online or call-in poll.

In message news: snipped-for-privacy@corp.supernews.com, Robert Reynolds sprach forth the following:

In a free market, once a product rises to a certain level of profitability, other capitalists enter into the business. This increased competition then levels the prices back down.

Of course this doesn't happen in the US gas market because the environuts have opposed EVERY refinery construction plan for the last 30 years.

Wait a second - I thought you said you "demand gasoline absolutely". Are you using E85 or gas?

Because in reality you're buying a result moreso than a product. You need to drive X miles. Gasoline will get you that result, but so will E85 (assuming you have an E85-compatible vehicle). So gas and E85 are really part of the same market. When one price moves, the other will too.

Which is why E85 is very bad news for anyone who eats.

In message news: snipped-for-privacy@corp.supernews.com, Robert Reynolds sprach forth the following:

You drive a van and put gas in it? Yet you harangue the gas companies? There's a name for you: John "I don't own an SUV - my family does!" Kerry.

In message news: snipped-for-privacy@corp.supernews.com, Robert Reynolds sprach forth the following:

Uh, yes it is.

Uh, actually they do. This and other statements of yours show that you pretty much have zero knowledge of economics and little desire to learn, so I'm not going to bother educating you.

I'm no big fan of the oil companies, but I always find it interesting that when people critical of them point to their "obscene profits", they never give the profit figures IN TERMS OF PERCENT OF REVENUE. Why is 9 or 10% profit considered bad for a company?

Also, they never discuss the price of gasoline in the U.S. of, say, 25 or 30 years ago in comparison to the INFLATION-ADJUSTED price of today. Why is today's price bad when it is lower than the price of 25 or 30 years ago WHEN ADJUSTED FOR INFLATION?

Anyone want to address those two questions?

Bill Putney (To reply by e-mail, replace the last letter of the alphabet in my address with the letter 'x')

Sure. I'll take the second question first since it's easier.

Inflation adjustment has no meaning because what matters is buying power, and that isn't dependent on prices, it is dependent on both income and prices. To put it simply, 30 years ago, more people made higher incomes when adjusted for inflation. Today, more people make lower incomes when adjust for inflation however the super-rich make far, far higher incomes when adjusted for inflation. That is what people mean when they say the gap between rich and poor is widening, and the middle class is losing average income.

An obvious symptom is that 50 years ago more 2 parent families could survive on a single breadwinners salary, today most 2 parent families have both parents working. The reduced supervision of children this creates has resulted in a much higher juvenile crime rate, among other things.

So, while many things are cheaper today, when adjusted for inflation, because people's income is even lower when adjusted for inflation, they have less buying power.

As for percent of revenue, the issue there is that in a normal industry, it is recognized that after a company pays off it's base costs, and before it pays dividends out, that if it has a lot of extra money due to a good year, that it is good business to spend that money expanding it's markets. Companies often spend surpluses on marketing campaigns, which can include severe short term undercutting of competitors, even selling at a loss to expand their market. Or they purchase competitors and seek to expand market that way. After all, the only way to insure the future existence of your company is to increase it's market share every year.

The oil companies by contrast never do this. Never once do they loss-lead gasoline or other oil products, nor have they taken serious steps in the last

20 years to expand market. The same companies making motor oil and gasoline today were making it 30 years ago and their market shares haven't changed much. In short, it appears to be a market where all the majors are colluding with each other to set prices, they seem to have a gentlemen's agreement among themselves that they will never seriously undersell each other to gain market.

Ted