Gas prices: The market doing what it does

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Gas prices: The market doing what it does

 I was just reading the news and saw that our illustrious President Bama is going to appoint a blue ribbon committee to investigate those EVIL oil speculators who are no doubt lining their filthy rich pockets by bidding up the price of oil for no reason..... other than of course the fact that the middle east is in turmoil, US oil production is still down from a 6-month moratorium on drilling in the gulf and the US dollar value, the main currency used in the oil trade, is at an all time low. Really, there is no reason at all for the price of oil to be up.....

 

The market is doing what it is supposed to do- indicating that there is a real problem and potential shortage of a valuable commodity. When the price of oil rises, that encourages entrepreneurs to do two things, to create alternatives to oil or to increase the supply of oil. With oil prices as high as they are the incentive for creating an electric car or vehicles that get far better gas mileage is substantially higher therefore encouraging people with money to invest in such ventures. In fact, Al Gore once suggested that the government should increase taxes on gasoline to the point that it was $5 a gallon to encourage the private sector to create alternatives. And he was right, that would be an effective way to reach his goal. Now that gas prices have naturally risen to such high levels, everyone is screaming about the greedy speculators. 

 

Why do speculators pay inflated prices for oil? Because they believe it will go higher. If it doesn't, they lose a shitload of money. If it does, they can make a shitload of money. The reason oil is so sensitive to any random news from the middle east is because a true oil shortage would create an economic disaster and those who owned the oil would become extraordinarily wealthy. Suppose you drove up to a gas station and tried to fill up  only to find there was no gas left for any price, what would you do? You would go to the next station and pay whatever price they were asking. You would probably also call anyone you cared about and tell them to fill up ASAP. If you are smart, you would get as many gas cans as you could and fill up. Our modern economy requires gasoline to work. Most people have to drive to work, most products are transported with vehicles that use gasoline, even our food supply requires substantial gasoline to be created. For these reasons, if a gasoline shortage occurred, people would be willing to pay $10, $20 even $50 a gallon, so the speculator that purchased the oil when gas is $4 a gallon would exponentially increase their investment in the case of a true shortage.

 

Now so far a true shortage has not happened. The price goes up, speculators bet and whoever has bought at the top price has been burned when the price goes down, losing their money. Speculators continue to do the same thing and continue to get burned because they believe that at some point there will be a real shortage, and when there is they will make good on whatever losses they suffered. (Of course, a good speculator tries to bail while the market is still going up by being the first to realize that a real shortage isn't going to occur and sell while others are still buying)

 

We should be recognizing the run up on oil prices as a symptom of a more systematic problem. Namely, our oil supply is not secure. Very smart people with a lot of money believe that someday there is going to be a shortage that will have devastating consequences to our economy. Rather than blaming the speculators for being greedy, we should be taking steps to solve the systematic problems. High oil prices will encourage the private sector to look for solutions. The government could help by getting out of the way. Paying high gas prices really sucks, but it is a heck of a lot better than having no gas. An attempt to artificially lower prices by controlling speculation or releasing the strategic oil reserves might be politically popular and nice in the short term, but would discourage the market from doing what it does best- ensure that products get supplied to people who want/need them. Take the high gas prices as an opportunity to encourage the development of gasoline alternatives and/or of our own local oil production. Drill baby drill.

 

 

 

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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 The demand for gas is very

 The demand for gas is very inelastic.  As you said people would be willing to pay $10, $20 or maybe even more for a gallon of gas if they have no other choice.  Given these facts is their anything to prevent investors from colluding together to drive prices up artificially?  As long as they all agreed to only release the gas back into the market slowly, maybe only at some kind of set price level, they could probably make a net return on their investment regardless of weather or not their is any kind of actual emergency.  I don't know enough about commodity markets to know if this is really possible, but the thought of this kind of situation concerns me.  


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 Don't forget that a chunk

 Don't forget that a chunk of the rise in commodities (oil, gold, silver, and others) is due in part to a weakening dollar. 

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RatDog wrote: The demand

RatDog wrote:

 The demand for gas is very inelastic.  As you said people would be willing to pay $10, $20 or maybe even more for a gallon of gas if they have no other choice.  Given these facts is their anything to prevent investors from colluding together to drive prices up artificially?  As long as they all agreed to only release the gas back into the market slowly, maybe only at some kind of set price level, they could probably make a net return on their investment regardless of weather or not their is any kind of actual emergency.  I don't know enough about commodity markets to know if this is really possible, but the thought of this kind of situation concerns me.  

 

Not really. While it is theoretically possible, the sheer amount of oil makes it extremely unlikely that anyone could pull such a move. Most attempts at cornering a large market have ended up costing the people making the attempt a ton of money. Oil is extremely plentiful. The US alone consumes 20 million barrels a day. To imagine that you could buy enough oil to effectively control the market would require a massive amount of money and would certainly attract a lot of attention. I wouldn't think it would be possible to even attempt such a move without somewhere around $800 million to control 10% of the market for a single day. To carry out an effective corner for a month or longer you would be looking at  around $24 billion+. 

 

The far greater danger for oil prices is OPEC which produces somewhere around 42% of the worlds oil. OPEC is an Oligarchy that would be illegal within US borders because it actively engages in production controls to keep oil artificially high and leaves us in a real danger of Saudi Arabia simply deciding to screw us. The only solution to that problem is to increase production in non-OPEC countries.  

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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 OK, may I be the first to

 

OK, may I be the first to point out that this is the end of April?

 

That may seem to be really obvious but apparently not to a good many of the people who use gasoline as they are surprised at what happens every year right around now.

 

Winter is over and everyone wants to get out to a base ball game, public park etc for the first time in months. There will be a “new” cyclical demand in the price at the pumps and that will bump prices a bit. By the end of June, you may see an increase of as much as $2 depending on how your local prices are structured.

 

In a couple of weeks, the internet will catch the same silly season thing that it does every year. “National Don't Buy Gas Day”. Here is how that works:

 

One day in mid May will be the official day. Everyone who want's to participate will “stick it to the man” by not buying gas that day and thus demonstrating the power of consumers who care. Well it will demonstrate the power of those consumers to gas up the day before so I don't think that it actually proves anything. Still, plenty of people are going to do exactly that.

 

Actually, a couple of years ago, we had a really silly year because the trucking industry decided to attack one specific provider by not buying at their pumps. Thus proving that if ignorance is bliss, then truckers are a happy lot.

 

The oil companies have the system set up so that such games don't even matter. Refineries are for the most part not owned by companies you have ever heard of. They make standardized fuels and put them into a common carrier distribution network. The gas you put in your car does not get branded until it goes in the tank truck for local delivery. That and most gas stations are franchises which big oil does not own directly either.

 

Big oil does not care where you buy your gas, they get paid when you buy gas – end of story.

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 The other thing that

 The other thing that really bugs me about the oil debate is anytime someone suggests drilling the barren desolate place that is ANWR the democrat snidely replies "Well that would take at least 10 years". I doubt a profit motivated company would take ten years unless government permits slowed them down; however, even if you grant the 10 year time frame, they have been making that argument for at least 20 years....

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Rich people never do

Rich people never do anything wrong and are always honest.

Beyond, being that Trump should be your hero, why is it even he says we are getting ripped off?

The price of gas goes way beyond a simple supply and demand and market speculation. It also has to do with the law makers being bought off by big oil.

If banks can pay off congress and car companies can pay off congress and dump their losses on us, and if BP can dump it's oil spills on us, then I am quite sure that big oil can pay off congress to set up the speculative market rules that drive it up way beyond what it should be.

What needs to happen with all these big companies is that their monopolies need to be broken and when the economy tanks like it did, beyond individual failure, the people who set up this wild west speculative rules who basically make it so they win even when they lose, need to be held accountable.

Everything is so simplistic to you. Maybe when America becomes a third world country you'll change your tune. Money does not automatically equal morality. Legal doesn't automatically equal morality.

America has the best government money can buy, and that is something you simply fail to see.

 

 

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I'd love it if these oil

I'd love it if these oil companies would start investing in their own alternative energy cars (electric, hydrogen, etc) instead of just trying to kill off the electric car industry as a threat to their profits. As is, there's no practical reason to buy an electric car or covert a standard car to electric - with the amount of money you'd have to pay, it would take 10-20 years for you to recoup whatever money you'd be saving by not buying gas.

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Recovering fundamentalist

Recovering fundamentalist wrote:

I'd love it if these oil companies would start investing in their own alternative energy cars (electric, hydrogen, etc) instead of just trying to kill off the electric car industry as a threat to their profits. As is, there's no practical reason to buy an electric car or covert a standard car to electric - with the amount of money you'd have to pay, it would take 10-20 years for you to recoup whatever money you'd be saving by not buying gas.

 

Why would an OIL company invest in alternative energy cars? They sell oil, so of course OIL companies want people to use oil. They have invested hundreds of millions researching potential replacements for oil, presumably so that when oil does run its course they can convert to something else. But it isn't the job of OIL companies to find a replacement for oil. Even if we stop using oil for gasoline, it has hundreds of other uses so those evil oil tycoons will still be making pretty good money.

 

Now a CAR company has several motivations for creating a car that runs on an alternative source. And it might be extremely profitable for a car company to join forces with a company that is invested in a new energy source to create an alternative to oil burning engines. However, as you point out in your own post, it isn't as easy as saying "Well lets build an electric car". We use oil for a reason, it is extremely efficient and extremely cheap. Currently, there is no energy source that is cheaper than oil. We have the tech to use several different kinds of fuel for our cars- propane, natural gas, electricity and even used cooking oil. The problem is that none of these alternatives are cheaper or more convenient than oil based gasoline, especially if there was a massive shift towards using one. When someone discovers a way to make an alternative energy vehicle economically viable, you can guarantee some car company will invest in it. That is how you make profit, you find something that can fill someones needs better and/or cheaper than what is available on the market now and create it. As the gasoline price goes up, it makes alternative options more economically viable.

 

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Brian37 wrote:Beyond, being

Brian37 wrote:

Beyond, being that Trump should be your hero, why is it even he says we are getting ripped off?

Trump said we should go in and steal Libya and Iraq's oil and threaten Saudi Arabia. Tempting. Almost enough to get me to vote for him..... well not quite. 

 

Brian37 wrote:

The price of gas goes way beyond a simple supply and demand and market speculation. It also has to do with the law makers being bought off by big oil.

 

Any evidence of that or should I buy you a tinfoil hat?

 

Brian37 wrote:

What needs to happen with all these big companies is that their monopolies need to be broken and when the economy tanks like it did, beyond individual failure, the people who set up this wild west speculative rules who basically make it so they win even when they lose, need to be held accountable.

Exactly which company has a monopoly? Do you even know what a monopoly is? The only thing approaching a monopoly in the oil industry is OPEC which is an oligarchy and as I pointed out in the OP a major problem that we need to deal with. Either through force or producing our own oil. Other than OPEC, the oil/gasoline industry is extremely competitive although state pricing laws have prevented people from enjoying the full benefits of that competition. (most states have minimum profit laws on gas stations, where can't sell their gas at a loss or at least not a large loss.) 

 

Brian37 wrote:

Everything is so simplistic to you. Maybe when America becomes a third world country you'll change your tune. Money does not automatically equal morality. Legal doesn't automatically equal morality.

 

Simplistic? No. But economics is extremely predictable. X goes in, Y comes out on a very consistent basis. When the government does A, B and C, it is fairly easy to predict the X, Y and Z will happen. You might recall that I predicted massive inflation would be occurring especially in the commodity markets several months ago when we first implemented QE2. Well, it is happening. Even our government is starting to admit it. 

http://www.rationalresponders.com/forum/27421

 

Beyond Saving wrote:

Inflation has started. The internal numbers show that manufacturing base costs have been rising, they just have not been passed to the consumer yet, but it is only a matter of time. The cost of food has also been rising and the cost of energy is likely to rise as well. 

Have you seen the news stories about McDonald's having to raise prices? Others will follow. It is a decidedly bad time to own stock in any restaurant. I'm sure your boss is aware of the difficulties approaching the industry in the near future as food prices go up and customers incomes don't, which will cause a larger number of them to decide to save money by cooking for themselves.

 

I also offered some investment advice back in November, which if you had listened to me you would have done quite well for yourself over the last 5 months.

 

Beyond Saving wrote:

A weakening dollar tells me that it would be wise to invest in exporters, commodities and companies that produce necessities in general. And having a little liquidity in physical gold, silver or gems

For the record, when I made that statement gold was $1,397 Silver was $26.74. Gold is now $1505 and silver $46.60 or 7.7% and 74% respectively. In other words, if you had invested a mere $2000 in silver because of my post, it would be worth roughly $3,485 today. You would have made $297/month profit without working. (Well a little less because of the actual fees/shipping involved in purchasing and selling the silver). And companies that export are the reason why the stock market is going strong. 

 

I also said,

 

Beyond Saving wrote:
 

The people who get screwed are the ones who don't have any investment money and are reliant solely on what they have in the bank or buy things like CDs or US treasury bonds or are surviving week to week on their paycheck. It sucks to be them anyway. If the dollar weakens substantially it will suck even more. Especially since food and energy are two things that can be expected to get significantly more expensive and are things you can't eliminate from your budget.

The price of food has skyrocketed. For example, since November the price of corn has gone from $5.87/bushel to $7.37 a 25.5% increase. Oil has gone up from $87.22 to $112.29, a 28.7% increase. 

 

These things are predictable if you pull your head out of your ass and pay a little bit of attention to the business pages. Which makes it all the more sad that our President and all our other illustrious leaders are so "surprised" when things like this happen and run around looking for people to blame. What they really need to do is look in a mirror.

 

And you need to get past your prejudices and simplistic stereotypes to understand what is happening. Of course, people with money are trying to make as much profit as they can. That is what rich people do. They look at the world and see thousands of money making opportunities (at least I do) and they pick which ones they think will work best. Rather than blame them when they find one, you should look behind the curtain and see WHY they believe oil, food and commodities are money making opportunities. Because if they are wrong, and sometimes they are, selling short is a massive money making opportunity. Ask anyone who sold the mortgage market short when the conventional wisdom was still "real estate ALWAYS goes up". Eventually, gold is going to collapse too and many people will lose a lot of money. The trick is timing when to sell and realize your gains. 
 

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Record profits.  

Record profits.

 

edit:

Brian37 wrote:

 

The price of gas goes way beyond a simple supply and demand and market speculation. It also has to do with the law makers being bought off by big oil.

 

 

 

"Any evidence of that or should I buy you a tinfoil hat?"

 

If there were evidence someone might be in trouble. I suspect they wouldn't come out and discuss it much and this conversation wouldn't be happening.

Haliburton was such a great and obvious example, Cheney still draws 150,000$ a year offa them.

Lobbyists suck big oil.

 

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Another thing, no it's not

Another thing, no it's not exactly a monopoly but I have a short story for you guys.

My dad owned a lawnmower shop back in the 80's (before they started using electronic ignition and plastic carbs). He sold lawnmower parts and small engine parts. One day one of the other 3 men who also owned a shop came in and had a talk with my dad. He discussed their pricing and suggested they, rather than compete, just normalize their pricing and go up a bit. Of course my ole dad was not as unscrupulous as this and sent him on his way.

Now you can pretend the oil companies don't play this game if you like but I think you may need a tinfoil hat yourself if this is the case.

edit: and yes when gas goes up everything goes up. The shipping cost on everything is directly related to the cost of gas, from a can of pork n beans to fruit of the loom underwear.

Thanks big oil.

Faith is the word but next to that snugged up closely "lie's" the want.
"By simple common sense I don't believe in god, in none."-Charlie Chaplin


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robj101 wrote:Record

robj101 wrote:

Record profits.

 

Yes, when the commodity you are selling goes up in value you make higher profits. That doesn't mean that gas prices going up is because companies are trying to make a larger profit. The problem with the "oil companies are price gouging" argument is that it ignores competition. If one company substantially lowered their prices they would get more business....until they ran out of oil. So if the high costs of gasoline was oil companies randomly deciding to stick it to the consumer, one company like say Exxon would cut their price to get a bigger share of the customer base. Companies will always try to charge the most that consumers will pay. That is what we do, we make profits. The problem is that other companies will take away our customers if we get too greedy. And the oil industry is extremely competitive. They make their big money through volume rather than price.  

 

In reality, gas profit margins are extremely small when compared to most industries, which is why the price reacts so quickly to the supply. Oil companies average around 10% of profit. So at $4/gallon approximately $0.40 is profit to the oil company and maybe another $0.10 goes to the gas station. The government takes more in taxes than that with approximately $0.45 to $0.55 going to the government depending on your state. So when some politician is bitching about oil profits....tell them to look in the mirror. Even so, if all the companies and even the government agreed to work for free and get no money the price of gas would still be over $3. 

 

 

edit: this site has some good breakdowns of gas prices now and over the last decade or so http://energyalmanac.ca.gov/gasoline/margins/index.html  

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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robj101 wrote:Another thing,

robj101 wrote:

Another thing, no it's not exactly a monopoly but I have a short story for you guys.

My dad owned a lawnmower shop back in the 80's (before they started using electronic ignition and plastic carbs). He sold lawnmower parts and small engine parts. One day one of the other 3 men who also owned a shop came in and had a talk with my dad. He discussed their pricing and suggested they, rather than compete, just normalize their pricing and go up a bit. Of course my ole dad was not as unscrupulous as this and sent him on his way.

Now you can pretend the oil companies don't play this game if you like but I think you may need a tinfoil hat yourself if this is the case.

edit: and yes when gas goes up everything goes up. The shipping cost on everything is directly related to the cost of gas, from a can of pork n beans to fruit of the loom underwear.

Thanks big oil.

 

That is called price fixing and is illegal under the Sherman Antitrust Act passed in 1890. Sure, it happens from time to time, mostly on a very small local level. On any kind of national/world scale it would be virtually impossible to even attempt. Why? Because suppose Exxon, Shell and BP decided to set the price high to make larger profits. They mark their gas up to $7.00/gallon, making big bucks right? Then what happens is that the evil greedy capitalist at Exxon comes out and says if we only charge $6.00/gallon, everyone in town is running to our stations, more money for us and suddenly they are slashing their prices down to compete. This effect used to be seen in the good old days of gas wars where companies would actually sell gas at a loss to compete with smaller gas companies. Most states have made that practice illegal with minimum pricing laws. 

 

Not to mention that Exxon, Shell and BP might be big oil companies in the US, but by world standards they are small. http://www.petrostrategies.org/Links/worlds_largest_oil_and_gas_companies.htm The largest oil companies are those that belong to OPEC. Which has engaged in price fixing in the past by reducing production. However, with this current spike they have not intentionally reduced production. In this particular case, the main cause is the weakening US dollar and unrest in the middle east. 

 

In other news, the EPA continues to deny new drilling permits. http://www.foxnews.com/us/2011/04/25/energy-america-oil-drilling-denial/#ixzz1KYb2WxDO 

Of course, I'm sure that will have absolutely no effect on domestic oil production or prices.

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Beyond Saving wrote:robj101

Beyond Saving wrote:

robj101 wrote:

Another thing, no it's not exactly a monopoly but I have a short story for you guys.

My dad owned a lawnmower shop back in the 80's (before they started using electronic ignition and plastic carbs). He sold lawnmower parts and small engine parts. One day one of the other 3 men who also owned a shop came in and had a talk with my dad. He discussed their pricing and suggested they, rather than compete, just normalize their pricing and go up a bit. Of course my ole dad was not as unscrupulous as this and sent him on his way.

Now you can pretend the oil companies don't play this game if you like but I think you may need a tinfoil hat yourself if this is the case.

edit: and yes when gas goes up everything goes up. The shipping cost on everything is directly related to the cost of gas, from a can of pork n beans to fruit of the loom underwear.

Thanks big oil.

 

That is called price fixing and is illegal under the Sherman Antitrust Act passed in 1890. Sure, it happens from time to time, mostly on a very small local level. On any kind of national/world scale it would be virtually impossible to even attempt. Why? Because suppose Exxon, Shell and BP decided to set the price high to make larger profits. They mark their gas up to $7.00/gallon, making big bucks right? Then what happens is that the evil greedy capitalist at Exxon comes out and says if we only charge $6.00/gallon, everyone in town is running to our stations, more money for us and suddenly they are slashing their prices down to compete. This effect used to be seen in the good old days of gas wars where companies would actually sell gas at a loss to compete with smaller gas companies. Most states have made that practice illegal with minimum pricing laws. 

 

Not to mention that Exxon, Shell and BP might be big oil companies in the US, but by world standards they are small. http://www.petrostrategies.org/Links/worlds_largest_oil_and_gas_companies.htm The largest oil companies are those that belong to OPEC. Which has engaged in price fixing in the past by reducing production. However, with this current spike they have not intentionally reduced production. In this particular case, the main cause is the weakening US dollar and unrest in the middle east. 

 

In other news, the EPA continues to deny new drilling permits. http://www.foxnews.com/us/2011/04/25/energy-america-oil-drilling-denial/#ixzz1KYb2WxDO 

Of course, I'm sure that will have absolutely no effect on domestic oil production or prices.

So what you are saying is that everything is fine. Dang man, could you adjust that hat, the sun reflecting off it is blinding me.

Faith is the word but next to that snugged up closely "lie's" the want.
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robj101 wrote:So what you

robj101 wrote:

So what you are saying is that everything is fine. Dang man, could you adjust that hat, the sun reflecting off it is blinding me.

 

No, I'm saying that if you want lower gas prices increase production domestically or in stable countries so that the oil supply is secure and stable. Blaming "big oil" and evil profiteers is pointless and will do nothing to solve the long term problems. As long as the bulk of the worlds oil supply comes from the middle east- the most unstable area of the world- oil will continue to become expensive.

 

The other part of the solution is to take steps to strengthen our dollar so that it can buy what it used to buy. That means controlling our governments debt and stop printing new money. 

 

Until you approach the problem with realistic solutions, nothing will change. Economics is predictable, and she is a bitch. 

 

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Beyond, I don't know how old

Beyond, I don't know how old you are. I am old enough to see technology change. You do NOT need the price of anything to get absurd for technology to change. Just the opposite, something new starts out high, and then gets cheaper. The same cannot be said for oil.

I can remember how expensive the first big bulky vcrs were in the 70s, and just like computers today, you wait a couple months or years and the price drops because newer stuff comes out.

Oil has not done that. Every single president since I was born in 66 has said "we need to get off oil" and we have had spiked prices every single decade. It has not motivated new technology to the point of motivation to get off oil.

It is because of deregulation AND corporate oil having too much influence on politics that create the environment beyond a normal free market forces.

We have had fuel economy technology that just now slowly creaping out that we could have had out a long time ago. Just like it took almost 20 years to mandate seatbelts.

The change that is now happening isn't because of market forces, but because the public is finally getting fed up with the lies and manipulation of these companies. I only hope it holds.

Please get this through your head. YOU CANNOT, NOR SHOULD YOU, leave anything to it's own devices, not a government, not a religion not even a business. If you want to argue too much regulation, or bad regulation, that is one thing. But you cannot expect me to buy a "fair market" considering how much influence these oil companies have on politics. This merely equals money equals power and might makes right.

Oil does not need our tax subsidies to survive. BP should have paid every cent of that oil spill instead of us. And  the crockodial tears of "If you tax us we will have to pass that on to the consumer" is nothing but blackmail.

You live in a utopia thinking that humans can live without government or taxes, but if we really had neither I doubt even you would want to live in such a world.

 

 

 

 

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Beyond Saving wrote:robj101

Beyond Saving wrote:

robj101 wrote:

So what you are saying is that everything is fine. Dang man, could you adjust that hat, the sun reflecting off it is blinding me.

 

No, I'm saying that if you want lower gas prices increase production domestically or in stable countries so that the oil supply is secure and stable. Blaming "big oil" and evil profiteers is pointless and will do nothing to solve the long term problems. As long as the bulk of the worlds oil supply comes from the middle east- the most unstable area of the world- oil will continue to become expensive.

 

The other part of the solution is to take steps to strengthen our dollar so that it can buy what it used to buy. That means controlling our governments debt and stop printing new money. 

 

Until you approach the problem with realistic solutions, nothing will change. Economics is predictable, and she is a bitch. 

 

But making seniors pay an 6 k more for "vouchers" for heathcare, that kind of robbery is ok because we need a way to pay those desperate oil companies who made 18 billion in one quarter, tax breaks.

Makes sense to me.

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Brian37 wrote:Beyond, I

Brian37 wrote:

Beyond, I don't know how old you are. I am old enough to see technology change. You do NOT need the price of anything to get absurd for technology to change. Just the opposite, something new starts out high, and then gets cheaper. The same cannot be said for oil.

You are talking about a radically different dynamic. In the case of new technology, the price usually starts out high because the demand for a brand new technology generally comes from people with extra luxury money and mass production takes a bit to ramp up. So companies being greedy like they are, stick it to the rich who don't want to wait. When production is increased, prices drop and companies start aiming for volume rather than price. Also, if a new technology is becoming popular, other companies will start making it. For example, if Sony came out with a holographic tv that had great quality they would charge a ton of money for it at first. Panasonic would hire reverse engineers to take the thing apart and figure out how it works, at which point they would create their own version. To compete they would release their tv at a slightly lower price than Sony. Sony then lowers their price to win back the market share. This leads to a race to the bottom, and the price will settle at a point where both companies believe that lowering the price would result in a smaller profit. Oil is not a manufactured product, it is a commodity and commodity markets have some differences from manufactured markets. 

 

Brian37 wrote:

Oil has not done that. Every single president since I was born in 66 has said "we need to get off oil" and we have had spiked prices every single decade. It has not motivated new technology to the point of motivation to get off oil.

Actually in inflation adjusted dollars it spiked in the late 70's, was going down throughout the 80's and by 1998 hit a record low going all the way back to 1946. It has only been since about 2004 that it started seriously climbing.  http://www.inflationdata.com/inflation/inflation_rate/historical_oil_prices_table.asp  

 

Brian37 wrote:

We have had fuel economy technology that just now slowly creaping out that we could have had out a long time ago. Just like it took almost 20 years to mandate seatbelts.

Really? Where is all this wonderful fuel economy technology? What possible reason would a car company have to not make a car that gets better gas mileage considering that there is a decent market of people looking for fuel efficient vehicles? Have you seen the cost of an old Geo Metro on the used market? People will pay good money for fuel efficiency. Unfortunately, the government outlawed the Geo Metro. It took years to mandate seat belts because not everyone wants seat belts and prefer not to pay for them. 

 

 

Brian37 wrote:

Oil does not need our tax subsidies to survive. BP should have paid every cent of that oil spill instead of us. 

Agreed. I am against tax subsidies for anyone, be it BP or Joe Sixpack. 

 

 

Brian37 wrote:

You live in a utopia thinking that humans can live without government or taxes, but if we really had neither I doubt even you would want to live in such a world.

What utopia? My arguments are the ones that have actual numbers and facts backing them up. You have only supplied me with what you feel and the way you imagine things are. 

 

 

Brian37 wrote:

But making seniors pay an 6 k more for "vouchers" for heathcare, that kind of robbery is ok because we need a way to pay those desperate oil companies who made 18 billion in one quarter, tax breaks.

Makes sense to me.

GO EXXON! RA RA REEE STEAL FROM GRANNIE!

How is it robbery to expect someone to pay for THEIR healthcare? I don't care if granny decides to pay for healthcare or not, that is her problem to find a way to deal with, if she decides not to pay for it that is her decision. I am not taking anything from her. Theft implies taking something away from someone. When you take $6000 from me and use it to pay for granny to go to the doctor you are stealing from me. Maybe for a good cause, but you are still stealing. Personally, I believe theft is always wrong.

 

And I know you have read many of my posts, I have said a thousand times we should throw out the entire tax code and implement either a flat tax or the fair tax. So you can stop throwing the corporate tax credit line at me. I don't support tax credits for anyone. I think every person should pay the same tax rate, no deductions, no exceptions, rich, poor or in between. 

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Beyond Saving wrote:  And

Beyond Saving wrote:

 

 

And I know you have read many of my posts, I have said a thousand times we should throw out the entire tax code and implement either a flat tax or the fair tax. So you can stop throwing the corporate tax credit line at me. I don't support tax credits for anyone. I think every person should pay the same tax rate, no deductions, no exceptions, rich, poor or in between. 

 

Well we agree on something.

 You can't always rely on "facts and figures" though and under the table money is called "under the table" for a reason and if you think big business does not stuff a politicians pocket you are in denial. Special interest's, special to who?

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robj101 wrote: You can't

robj101 wrote:

 You can't always rely on "facts and figures" though and under the table money is called "under the table" for a reason and if you think big business does not stuff a politicians pocket you are in denial. Special interest's, special to who?

I agree, except the corporations stuffing a politicians pocket has as much to do with the politician having the power to destroy portions of that corporations business as it does with trying to control other corporations. To me the obvious solution is to remove the politicians power. If the politician has little to no power, there is no reason for a corporation to stuff their pockets. Brian thinks the politicians should have more power while complaining about the corporations throwing money at them. I fail to see how more regulation leads to anything other than more reasons for corporations to bribe and/or pay protection money to politicians.

 

The alliance between politicians and corporations is the single largest danger to our country. And increasing regulation, making the tax code more complicated and make exceptions only makes the problems worse. Substantially shrinking the federal government in size and power is the only logical solution. 

 

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Beyond Saving wrote:robj101

Beyond Saving wrote:

robj101 wrote:

So what you are saying is that everything is fine. Dang man, could you adjust that hat, the sun reflecting off it is blinding me.

 

No, I'm saying that if you want lower gas prices increase production domestically or in stable countries so that the oil supply is secure and stable. Blaming "big oil" and evil profiteers is pointless and will do nothing to solve the long term problems. As long as the bulk of the worlds oil supply comes from the middle east- the most unstable area of the world- oil will continue to become expensive.

 

The other part of the solution is to take steps to strengthen our dollar so that it can buy what it used to buy. That means controlling our governments debt and stop printing new money. 

 

Until you approach the problem with realistic solutions, nothing will change. Economics is predictable, and she is a bitch. 

Until there is a mega crisis, change will be slow.

Over the last 2 decades, there have been dozens and dozens of design studies, and prototypes built and tested, with technologies that could be being implemented, to increase fuel mileage (among other benefits), and aren't.

The current technology, higher tech materials, processes, and smart engineering and manufacturing concepts, all exist, have been tested, and are being used in other industries to great effect (like aviation), in order to substantially increase fuel mileage.

Part of it is a mystery to me, and part of it is not, as to why it takes so long for the migration of these innovations to become the norm, in automotive.

Part of it is the American mentality of "Mo Bigga, Mo Betta", and part of it may have to do with the UAW.

Europe usually seems to be the leaders in changing paradigms, with Japan somewhat parallel, IMO.

 

One needs not look much further than under the composite skin of the Lotus Elise, to see tremendous potential to make cars substantially lighter, be able to use much smaller powerplants, and still far exceed levels of efficiency, performance, and longevity of most current vehicles.

 

I keep asking myself " Are they just playin' stupid, or are they just plain stupid?..."

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robj101 wrote:Another thing,

robj101 wrote:

Another thing, no it's not exactly a monopoly

 

Rather, it's just an oligopoly - just like a monopoly, except it's 4-5 key players who all match prices within a few cents of each other per gallon.  Also, supply of crude went up towards the end of 2008, and yet prices were speculated to continue upwards. An investment bubble was created, and subsequently popped next year. On top of all that, the cost of consumer goods increased disproportionately to the increase of transportation costs. Big business likes to profit from increased cost, likely because they (rightly) believe that John Q Consumer will remain ignorant of the practice and habitually attribute it to 'buzzword' factors attributed to by mass media.

It is delusional to think that free markets is a boon to anything except producer's finances.

Thanks, Big Business.

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Beyond Saving wrote:The

Beyond Saving wrote:
And increasing regulation, making the tax code more complicated and make exceptions only makes the problems worse. Substantially shrinking the federal government in size and power is the only logical solution.

Do you have data to back this up?

“A meritocratic society is one in which inequalities of wealth and social position solely reflect the unequal distribution of merit or skills amongst human beings, or are based upon factors beyond human control, for example luck or chance. Such a society is socially just because individuals are judged not by their gender, the colour of their skin or their religion, but according to their talents and willingness to work, or on what Martin Luther King called 'the content of their character'. By extension, social equality is unjust because it treats unequal individuals equally.” "Political Ideologies" by Andrew Heywood (2003)


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Crude oil futures fluctuate

 

edit:errr... that link didn't claim what I thought it did.

 

“A meritocratic society is one in which inequalities of wealth and social position solely reflect the unequal distribution of merit or skills amongst human beings, or are based upon factors beyond human control, for example luck or chance. Such a society is socially just because individuals are judged not by their gender, the colour of their skin or their religion, but according to their talents and willingness to work, or on what Martin Luther King called 'the content of their character'. By extension, social equality is unjust because it treats unequal individuals equally.” "Political Ideologies" by Andrew Heywood (2003)


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redneF wrote:

 

Europe usually seems to be the leaders in changing paradigms, with Japan somewhat parallel, IMO.

 

It's been argued that we are about 20 years behind europe, whatever is happening there will be happening here and in many ways this seems like a sound conclusion.

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Beyond Saving wrote:

 Substantially shrinking the federal government in size and power is the only logical solution. 

 

Which is one of the things I liked about ron paul...lol

China will overtake us very shortly and their import of oil is rising as we speak.

Untill we get people off the welfare tit we will continue to shrink. The system is abused at both ends.

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robj101 wrote:China will

robj101 wrote:

China will overtake us very shortly and their import of oil is rising as we speak.

I believe China is now the second largest producer of steel, in the world.

They are also rapidly expanding in the manufacturing of plastic, and if the steep trend continues, they will greatly impact North American producers of plastic products.

If North America doesn't smarten up real soon, China will swallow up the US, and in turn, Canada.

From what I understand, there are very different trade policies between the US and China, as compared to the US and Japan.

The US is in bed with China, but it could end up costing everything.

I keep asking myself " Are they just playin' stupid, or are they just plain stupid?..."

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redneF wrote:Beyond Saving

redneF wrote:

Beyond Saving wrote:

robj101 wrote:

So what you are saying is that everything is fine. Dang man, could you adjust that hat, the sun reflecting off it is blinding me.

 

No, I'm saying that if you want lower gas prices increase production domestically or in stable countries so that the oil supply is secure and stable. Blaming "big oil" and evil profiteers is pointless and will do nothing to solve the long term problems. As long as the bulk of the worlds oil supply comes from the middle east- the most unstable area of the world- oil will continue to become expensive.

 

The other part of the solution is to take steps to strengthen our dollar so that it can buy what it used to buy. That means controlling our governments debt and stop printing new money. 

 

Until you approach the problem with realistic solutions, nothing will change. Economics is predictable, and she is a bitch. 

Until there is a mega crisis, change will be slow.

Over the last 2 decades, there have been dozens and dozens of design studies, and prototypes built and tested, with technologies that could be being implemented, to increase fuel mileage (among other benefits), and aren't.

The current technology, higher tech materials, processes, and smart engineering and manufacturing concepts, all exist, have been tested, and are being used in other industries to great effect (like aviation), in order to substantially increase fuel mileage.

Part of it is a mystery to me, and part of it is not, as to why it takes so long for the migration of these innovations to become the norm, in automotive.

Part of it is the American mentality of "Mo Bigga, Mo Betta", and part of it may have to do with the UAW.

Europe usually seems to be the leaders in changing paradigms, with Japan somewhat parallel, IMO.

 

One needs not look much further than under the composite skin of the Lotus Elise, to see tremendous potential to make cars substantially lighter, be able to use much smaller powerplants, and still far exceed levels of efficiency, performance, and longevity of most current vehicles.

 

Well the reason we can't have lighter cars is because they don't meet government safety standards. In 2002, the government updated its standards requiring cars to be heavier, then they did it again in 2009. That is why the 2001 Saturn SL got 40 mpg while the 2002 Saturn Ion only go around 32 even though they were essentially the same car because of the increased weight from additional airbags, more reinforcement etc. So I guess I should clarify my statement that car companies WOULD come out with cars that get better gas mileage if they could get them approved by government safety inspectors without taking expensive risks.

 

Of course, the American demand for larger cars is part of it. Until the recent spike in gas prices, most Americans wanted large vehicles (remember the Hummer craze?) Now that more people are demanding high gas mileage, car companies might go through the expense to get some smaller vehicles approved by the government.

 

If we took the government out of the picture, we could be buying these

http://www.popularmechanics.com/cars/news/fuel-economy/4276559

 

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Kapkao wrote:Beyond Saving

Kapkao wrote:

Beyond Saving wrote:
And increasing regulation, making the tax code more complicated and make exceptions only makes the problems worse. Substantially shrinking the federal government in size and power is the only logical solution.

Do you have data to back this up?

 

 

As federal government spending and regulation has gone up, so has the amount being spent on lobbying. Not much of a surprise. I suppose you can argue that correlation does not equal causation, but I think it is approaching truism to say that the reason corporations spend money on politicians is because they believe the politicians can do something for them or can do something to harm them. Therefore, I draw the conclusion that giving the government more power over more areas will give a corporation more reason to attempt to bribe the politicians. I doubt many corporations give money to politicians simply because they like them as golf partners. If you do a little homework you will also see that there is a correlation between companies that donated heavily to the right politicians and those that received billions of tax payer dollars in stimulus. Coincidence? I don't think so. 

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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http://www.youtube.com/watch?

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Beyond Saving wrote:Kapkao

Beyond Saving wrote:

Kapkao wrote:

Beyond Saving wrote:
And increasing regulation, making the tax code more complicated and make exceptions only makes the problems worse. Substantially shrinking the federal government in size and power is the only logical solution.

Do you have data to back this up?

 

 

As federal government spending and regulation has gone up, so has the amount being spent on lobbying. Not much of a surprise. I suppose you can argue that correlation does not equal causation, but I think it is approaching truism to say that the reason corporations spend money on politicians is because they believe the politicians can do something for them or can do something to harm them. Therefore, I draw the conclusion that giving the government more power over more areas will give a corporation more reason to attempt to bribe the politicians. I doubt many corporations give money to politicians simply because they like them as golf partners. If you do a little homework you will also see that there is a correlation between companies that donated heavily to the right politicians and those that received billions of tax payer dollars in stimulus. Coincidence? I don't think so. 

So putting figureheads in one's pocket earns a lot of free lunches. You're right, no surprise there.

How much do  lobbying expenses correlate to inflation?

From 2000-2010, the inflation rate averages to 2.54 (including 2009, which had -0.34%), so anywhere from a quarter to half of said expenses. How many new businesses become engaged in lobbying each of those years? Did lobbying lawyers demand a raise any of those years? 

There may actually be a correlation, but there certainly isn't enough data to ascertain that here. To borrow an example from the land of wacky fundamentalism™, supposedly there is a correlation between sexual liberty (a 60s thing) and crime rate.

There isn't anything of the sort, because crime has gone down steadily over the decades... and one might as well get a horoscope reading if they are going to inquire religious nuts about anything except tomorrow's forecast. But two sets of data could, at best, demonstrate that litigation has gotten more expensive over time.

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He'll be lucky to make a comeback in 2013, at the rate he's currently going. Clean energy (at it's current tech) isn't going to do much to Big Oil. You can't put clean energy in a car, airplane, or chopper on a scale large enough to be significant to the towering output of co2 from gasoline. Fission -though it is palatable- has a bad rap for the forseeable future. I'll have gray hair -and possibly a few organ transplants- by the time fusion supplants coal.

But you can sure as hell tax the fuck out of energy, angering a lot to citizenry and shaking up a number of independents and centrists. Barrack is the best friend any Republican could ask for, he simply didn't realize it until it was too late.

“A meritocratic society is one in which inequalities of wealth and social position solely reflect the unequal distribution of merit or skills amongst human beings, or are based upon factors beyond human control, for example luck or chance. Such a society is socially just because individuals are judged not by their gender, the colour of their skin or their religion, but according to their talents and willingness to work, or on what Martin Luther King called 'the content of their character'. By extension, social equality is unjust because it treats unequal individuals equally.” "Political Ideologies" by Andrew Heywood (2003)


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Kapkao wrote:robj101

Kapkao wrote:

He'll be lucky to make a comeback in 2013, at the rate he's currently going. Clean energy (at it's current tech) isn't going to do much to Big Oil. You can't put clean energy in a car, airplane, or chopper on a scale large enough to be significant to the towering output of co2 from gasoline. Fission -though it is palatable- has a bad rap for the forseeable future. I'll have gray hair -and possibly a few organ transplants- by the time fusion supplants coal.

But you can sure as hell tax the fuck out of energy, angering a lot to citizenry and shaking up a number of independents and centrists. Barrack is the best friend any Republican could ask for, he simply didn't realize it until it was too late.

Yea I didn't say I liked him. I didn't even vote and I wont untill someone worth a shit has a shot. I did want him to win just because I figured mcain would just be another bush and we needed to switch fuck positions. Obama has just switched to kind of a sideways fuck.

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Kapkao wrote:How much do 

Kapkao wrote:

How much do  lobbying expenses correlate to inflation?

From 2000-2010, the inflation rate averages to 2.54 (including 2009, which had -0.34%), so anywhere from a quarter to half of said expenses. How many new businesses become engaged in lobbying each of those years? Did lobbying lawyers demand a raise any of those years? 

There may actually be a correlation, but there certainly isn't enough data to ascertain that here. To borrow an example from the land of wacky fundamentalism™, supposedly there is a correlation between sexual liberty (a 60s thing) and crime rate.

There isn't anything of the sort, because crime has gone down steadily over the decades... and one might as well get a horoscope reading if they are going to inquire religious nuts about anything except tomorrow's forecast. But two sets of data could, at best, demonstrate that litigation has gotten more expensive over time.

 

 

I don't know, and I really don't care. It is an ancillary point that really doesn't have anything to do with my central argument, I'm not going to write a book about it. I don't even care if companies lobby. Lobbyists are what everyone else is complaining about. If companies want to randomly give away a billion dollars to some politician cause they think he is sexy, who am I to tell them what to do with their money? Although, I would bet my money on lobbying efforts dropping if government power was significantly shrunk and it would be a side benefit for all those who care about lobbying money.

 

Since government has never shrunk since lobbying became a full time job, we have no data other than common sense and the knowledge that companies don't give politicians money for no reason- they aren't going to spend a million dollars on a politician who does not have the power to help them in any way. We should do an experiment and eliminate the federal government, then count how many Senators can remain millionaires. I'll vote for that.   

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Kapkao wrote:It is

Kapkao wrote:

It is delusional to think that free markets is a boon to anything except producer's finances.

 

Isn't the whole point of having an economy to produce? Yeah, those who cause production make money. Amazing. Can you believe a financial system that rewards producers? We should have one that rewards consuming. That would be so much better, we could get rich just by using more stuff.  

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Beyond Saving wrote:Kapkao

Beyond Saving wrote:

Kapkao wrote:

It is delusional to think that free markets is a boon to anything except producer's finances.

 

Isn't the whole point of having an economy to produce? Yeah, those who cause production make money. Amazing. Can you believe a financial system that rewards producers? We should have one that rewards consuming. That would be so much better, we could get rich just by using more stuff.  

Strawman.

I somehow doubted you wouldn't have a real counterargument to this, which is why I worded it as such.

“A meritocratic society is one in which inequalities of wealth and social position solely reflect the unequal distribution of merit or skills amongst human beings, or are based upon factors beyond human control, for example luck or chance. Such a society is socially just because individuals are judged not by their gender, the colour of their skin or their religion, but according to their talents and willingness to work, or on what Martin Luther King called 'the content of their character'. By extension, social equality is unjust because it treats unequal individuals equally.” "Political Ideologies" by Andrew Heywood (2003)


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Beyond Saving wrote:Since

Beyond Saving wrote:

Since government has never shrunk since lobbying became a full time job, we have no data other than common sense and the knowledge that companies don't give politicians money for no reason- they aren't going to spend a million dollars on a politician who does not have the power to help them in any way. We should do an experiment and eliminate the federal government, then count how many Senators can remain millionaires. I'll vote for that.   

1. Your proposal isn't going anywhere, anytime soon. It doesn't have any selling strength. You'll need to convince people  it's in their best interest to dispose of antitrust laws  and consumer protections. Good luck.

2. I kinda like having food and medicine that is safe to consume. So unless you can think of better/more efficient means of ensuring that...

3. I'd rather some of the bigger gov't bedfellows stay at oligopoly status. Anti-competitive practices being what they are, and all...

4. Lobbying is inevitable. It's natural for people of all walks of life -particularly the middle class- to organize around a common interest. There is no inevitable harm in that.

5. There is harm in a supreme court that (currently) votes solely in favor of big business on several key decisions.

 

“A meritocratic society is one in which inequalities of wealth and social position solely reflect the unequal distribution of merit or skills amongst human beings, or are based upon factors beyond human control, for example luck or chance. Such a society is socially just because individuals are judged not by their gender, the colour of their skin or their religion, but according to their talents and willingness to work, or on what Martin Luther King called 'the content of their character'. By extension, social equality is unjust because it treats unequal individuals equally.” "Political Ideologies" by Andrew Heywood (2003)


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Kapkao wrote:Beyond Saving

Kapkao wrote:

Beyond Saving wrote:

Kapkao wrote:

It is delusional to think that free markets is a boon to anything except producer's finances.

 

Isn't the whole point of having an economy to produce? Yeah, those who cause production make money. Amazing. Can you believe a financial system that rewards producers? We should have one that rewards consuming. That would be so much better, we could get rich just by using more stuff.  

Strawman.

I somehow doubted you wouldn't have a real counterargument to this, which is why I worded it as such.

What is the purpose of an economy? I wasn't aware that what you said amounted to an argument. Sounded more like a one liner to me. And I agree the free market is a boon to producers finances. I fail to see why that is a bad thing. 

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Kapkao wrote:1. Your

Kapkao wrote:

1. Your proposal isn't going anywhere, anytime soon. It doesn't have any selling strength. You'll need to convince people  it's in their best interest to dispose of antitrust laws  and consumer protections. Good luck.

2. I kinda like having food and medicine that is safe to consume. So unless you can think of better/more efficient means of ensuring that... 

3. I'd rather some of the bigger gov't bedfellows stay at oligopoly status. Anti-competitive practices being what they are, and all...

4. Lobbying is inevitable. It's natural for people of all walks of life -particularly the middle class- to organize around a common interest. There is no inevitable harm in that.

5. There is harm in a supreme court that (currently) votes solely in favor of big business on several key decisions.

1. No shit. Don't worry, I'm not going to waste my time/money trying. I gave up on the American people when Bush was elected to a second term.

 

2. Is there any reason why states can't perform those functions? In fact, every state already has its own laws and food inspection agencies, many of which are far more strict than the federal regulations. Personally, I don't trust food simply because it has a government stamp of approval. There are some places I don't eat at and some grocery stores I don't shop at, government approval or not. 

 

3. I would rather not have a big government for them to be bedfellows with. Government should be the referee not an active participant like it is now.

 

4. True, but I maintain that the more regulatory power there is, the more incentive there is to lobby. It is pointless to lobby someone who doesn't have power. 

 

5. There is harm in a Supreme Court that is making political decisions rather than legal ones. Even if I happen to agree with the political decision.

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Beyond Saving wrote:Kapkao

Beyond Saving wrote:

Kapkao wrote:

It is delusional to think that free markets is a boon to anything except producer's finances.

 

Isn't the whole point of having an economy to produce? Yeah, those who cause production make money. Amazing. Can you believe a financial system that rewards producers? We should have one that rewards consuming. That would be so much better, we could get rich just by using more stuff.  

The problem is that oil is not something that is produced. It is limited natural resourse that is rapidly being used up. So I believe it needs to be treated differently than something produced by work.

We don't have a 'free market' where everyone has equal rights and privledges. The rich are able to buy special rights and in doing so make themselves richer. In order to drill for oil, the goverment has to grant drilling rights. These rights either go to the highest bidder or the hightest campaign contributor. Since oil is a limited commodity, the rich get richer off of is scarsity not so much from their work and innovation.

“Religion is regarded by the common people as true, by the wise as false, and by the rulers as useful.” Seneca


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Beyond Saving wrote:What is

Beyond Saving wrote:

What is the purpose of an economy? I wasn't aware that what you said amounted to an argument. Sounded more like a one liner to me. And I agree the free market is a boon to producers finances. I fail to see why that is a bad thing. 

The entire post would constitute an argument, the one sentence you left in -a point- and the one part of the sentence you remain focused on, a soundbite. Nice try.

What does your completely unregulated market do to labor and consumption except eliminate a whopping chunk of their protections to prevent foodborn illness or... workplace accidents, transportation dangers, etc? These are all "regulations" that businesses seem unwilling carry out themselves.*

What does your ideology do to prevent one particular company from, say... acquiring in over half of a marketshare of a related product or sets of products of services? Yes, in a "free" market, different companies  can compete, but this doesn't stop one company from trying to corner an entire market (with little or no government aid.) It's been attempted before, and it will probably be attempted again... with likelyhood of success depending proportionately to a costly barrier to entry. We've seen limited amounts of success in the realms of desktop operating systems, defense contracts (Lockheed-Martin), oil (Standard Oil), steel (US Steel), and of course government-controlled electrical power. The one experiment at free market electrical power went south in a hurry, in no small part to a deeply criminal Enron directly manipulating the market forces at work. Luckily, Enron had a few whistleblowers in it's own ranks.

 

*The only historical example running contrary to this (that I'm aware of) is the MPAA of the early 1900s putting a strict, internal censorship of content believed unfit for the audience of that time. It was a remarkable demonstration of enlightened self-preservation, but it only came after movie producers saw what was happening to radio and early broadcast television. Then the "Miracle" decision came in the early 1960s, and the Supreme Court declared movies qualified as a "form of art", making the MPAA's self-regulation irrelevant.

“A meritocratic society is one in which inequalities of wealth and social position solely reflect the unequal distribution of merit or skills amongst human beings, or are based upon factors beyond human control, for example luck or chance. Such a society is socially just because individuals are judged not by their gender, the colour of their skin or their religion, but according to their talents and willingness to work, or on what Martin Luther King called 'the content of their character'. By extension, social equality is unjust because it treats unequal individuals equally.” "Political Ideologies" by Andrew Heywood (2003)


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EXC wrote: The problem is

EXC wrote:

 

The problem is that oil is not something that is produced. It is limited natural resourse that is rapidly being used up. So I believe it needs to be treated differently than something produced by work.

Oil has a blue-collar workforce comparable to other vital, processed goods industries. The mechanics are largely similar, with the exception of OPEC.

http://www.bls.gov/oes/2008/may/naics4_324100.htm

edit; lesdyxia

 

edit2; link

“A meritocratic society is one in which inequalities of wealth and social position solely reflect the unequal distribution of merit or skills amongst human beings, or are based upon factors beyond human control, for example luck or chance. Such a society is socially just because individuals are judged not by their gender, the colour of their skin or their religion, but according to their talents and willingness to work, or on what Martin Luther King called 'the content of their character'. By extension, social equality is unjust because it treats unequal individuals equally.” "Political Ideologies" by Andrew Heywood (2003)


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Beyond Saving wrote: 3. I

Beyond Saving wrote:

 

3. I would rather not have a big government for them to be bedfellows with. Government should be the referee not an active participant like it is now.

 

Suppose you or another conservative owned a large plot of land. You are making lots of money drilling for oil and growing food on the land. Then a group of communist anarchists angry about high gas and food prices form a militia and take your land saying "you're getting rich doing nothing, we're going poor working our ass off."

Why in this case are conservatives so in favor of big government intervention to take back the land? Isn't most of the politics on the left and right just about getting special rights at the expense of others? Government by definition is the sovereign authority over a territorial area, so why can't they regulate how and by whom that land is used?

“Religion is regarded by the common people as true, by the wise as false, and by the rulers as useful.” Seneca


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Kapkao wrote:EXC wrote: The

Kapkao wrote:

EXC wrote:

 

The problem is that oil is not something that is produced. It is limited natural resource that is rapidly being used up. So I believe it needs to be treated differently than something produced by work.

Oil has a blue-collar workforce comparable to other vital, processed goods industries. The mechanics are largely similar, with the exception of OPEC.

You're talking about drilling for oil, not producing oil. Nature already produced the oil in limited amounts. The high price is driven by it's limited availability which is just going to get worse. There's pleanty of unemployed people that could work to drill for oil, but we don't have enough places for them to drill.

So it seems the government should intervene to get the country off oil or there will be dire economic consequences in the future.

 

“Religion is regarded by the common people as true, by the wise as false, and by the rulers as useful.” Seneca


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Kapkao wrote:Beyond Saving

Kapkao wrote:

Beyond Saving wrote:

What is the purpose of an economy? I wasn't aware that what you said amounted to an argument. Sounded more like a one liner to me. And I agree the free market is a boon to producers finances. I fail to see why that is a bad thing. 

The entire post would constitute an argument, the one sentence you left in -a point- and the one part of the sentence you remain focused on, a soundbite. Nice try.

What does your completely unregulated market do to labor and consumption except eliminate a whopping chunk of their protections to prevent foodborn illness or... workplace accidents, transportation dangers, etc? These are all "regulations" that businesses seem unwilling carry out themselves.*

What does your ideology do to prevent one particular company from, say... acquiring in over half of a marketshare of a related product or sets of products of services? Yes, in a "free" market, different companies  can compete, but this doesn't stop one company from trying to corner an entire market (with little or no government aid.) It's been attempted before, and it will probably be attempted again... with likelyhood of success depending proportionately to a costly barrier to entry. We've seen limited amounts of success in the realms of desktop operating systems, defense contracts (Lockheed-Martin), oil (Standard Oil), steel (US Steel), and of course government-controlled electrical power. The one experiment at free market electrical power went south in a hurry, in no small part to a deeply criminal Enron directly manipulating the market forces at work. Luckily, Enron had a few whistleblowers in it's own ranks.

 

*The only historical example running contrary to this (that I'm aware of) is the MPAA of the early 1900s putting a strict, internal censorship of content believed unfit for the audience of that time. It was a remarkable demonstration of enlightened self-preservation, but it only came after movie producers saw what was happening to radio and early broadcast television. Then the "Miracle" decision came in the early 1960s, and the Supreme Court declared movies qualified as a "form of art", making the MPAA's self-regulation irrelevant.

 

When have I said in this thread or any other that government shouldn't break up monopolies? The governments role precisely ought to be to ensure that a true monopoly can never take hold because a true monopoly is a threat to the free market. However, in practice, monopolies usually don't exist without government aid. This is even more true in the modern era where transportation is easier and you are really competing globally. Whereas you used to be able to have an effective monopoly in a town, now you have to monopolize at least a state if not the whole country.

 

Now I don't care if one company gets 50% or 90% or even 90% of the market share as long as there are no barriers that prevent another company from competing. If 90% of people want to buy from the company because they like the product better or it is cheaper I don't care. Now if a company is making it impossible for others to enter the business, for example suppose an oil company started buying ports and would only allow tankers carrying oil from their drilling into the port, then the government needs to step in. 

 

There is a gigantic difference between breaking up monopolies and having hundreds of federal regulating agencies. Part of my big beef with government regulations is that they make it significantly harder for an outsider to come into a particular industry. Even if you were a billionaire, you would have a hell of a time starting an oil company because of the red tape required to drill anywhere. By restricting the ability of outsiders to compete in a given industry, you encourage the development of monopolies/oligopolies, the exact opposite of what I have always argued the government ought to do. 

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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EXC wrote:Beyond Saving

EXC wrote:

Beyond Saving wrote:

 

3. I would rather not have a big government for them to be bedfellows with. Government should be the referee not an active participant like it is now.

 

Suppose you or another conservative owned a large plot of land. You are making lots of money drilling for oil and growing food on the land. Then a group of communist anarchists angry about high gas and food prices form a militia and take your land saying "you're getting rich doing nothing, we're going poor working our ass off."

Why in this case are conservatives so in favor of big government intervention to take back the land? Isn't most of the politics on the left and right just about getting special rights at the expense of others? Government by definition is the sovereign authority over a territorial area, so why can't they regulate how and by whom that land is used?

 

Personally, I don't really have a problem shooting them myself, but others tend to look down on that idea. It is nice to live in an environment where you don't have to kill people to keep your land.

 

That is the one problem I have with anarchists, they think that people aren't going to own land. I don't see how society is going to function without private land ownership. Why would anyone build a factory if anyone can walk in off the street and take whatever they want? How do you decide who gets to live on top of the beautiful hill? What if you build a nice house and someone else decides to live in it? Ultimately, you would have to use force to keep it, or simply allow others to take the fruit of your labor. Government is simply a way for us to resolve our disagreements without having to use direct physical force against each other. I don't understand how anti-property anarchists believe the world would work with our current population. 

I just usually go with my own taste. If I like something, and it happens to be against the law, well, then I might have a problem.- Hunter S. Thompson


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Beyond Saving wrote:redneF

Beyond Saving wrote:

redneF wrote:

Beyond Saving wrote:

robj101 wrote:

So what you are saying is that everything is fine. Dang man, could you adjust that hat, the sun reflecting off it is blinding me.

 

No, I'm saying that if you want lower gas prices increase production domestically or in stable countries so that the oil supply is secure and stable. Blaming "big oil" and evil profiteers is pointless and will do nothing to solve the long term problems. As long as the bulk of the worlds oil supply comes from the middle east- the most unstable area of the world- oil will continue to become expensive.

 

The other part of the solution is to take steps to strengthen our dollar so that it can buy what it used to buy. That means controlling our governments debt and stop printing new money. 

 

Until you approach the problem with realistic solutions, nothing will change. Economics is predictable, and she is a bitch. 

Until there is a mega crisis, change will be slow.

Over the last 2 decades, there have been dozens and dozens of design studies, and prototypes built and tested, with technologies that could be being implemented, to increase fuel mileage (among other benefits), and aren't.

The current technology, higher tech materials, processes, and smart engineering and manufacturing concepts, all exist, have been tested, and are being used in other industries to great effect (like aviation), in order to substantially increase fuel mileage.

Part of it is a mystery to me, and part of it is not, as to why it takes so long for the migration of these innovations to become the norm, in automotive.

Part of it is the American mentality of "Mo Bigga, Mo Betta", and part of it may have to do with the UAW.

Europe usually seems to be the leaders in changing paradigms, with Japan somewhat parallel, IMO.

 

One needs not look much further than under the composite skin of the Lotus Elise, to see tremendous potential to make cars substantially lighter, be able to use much smaller powerplants, and still far exceed levels of efficiency, performance, and longevity of most current vehicles.

 

Well the reason we can't have lighter cars is because they don't meet government safety standards.

IIRC the curb weight on a current Lotus Elise is 1850 lbs, while a BMW M roadster is over 3300 lbs. The '96 Lotus Elise was 1650 lbs. The Elise meets US crash standards.

Beyond Saving wrote:
In 2002, the government updated its standards requiring cars to be heavier, then they did it again in 2009.

The cars do not need to necessarily become heavier, to become stiffer and stronger. That's a complete myth.

There's little reason we cannot be manufacturing vehicles that weigh 1000 lbs less than they currently do, and more economically, and out of more easily recyclable materials, and with longer average lifespans.

The technology has already been explored. There's simply no incentive for Amercian car companies to shift the paradigm.

Well, until the imports do it, and begin gaining market share...

Beyond Saving wrote:
So I guess I should clarify my statement that car companies WOULD come out with cars that get better gas mileage if they could get them approved by government safety inspectors without taking expensive risks.

Bullshit.

It's all about engineering, and better materials.

The C5 Corvette has a ladder frame chassis, like a pickup truck. Most cars are unibodies (monocoque).

The ladder frame in the C5 was a quantum leap in performance compared to the C4 ladder frame. The C5 was based on 2 single tubes that begin as mandrel bent tubes, that are later hydroformed in a die, and welded together with a few horizontal sections, and form a ladder frame over 4 times stronger and stiffer than a C4 ladder frame, and weighs almost 100 lbs less.

The floor of a C5 is a sandwich of balsa wood and fiberglass. The transverse leaf springs of the suspension are fiberglass. The body is made of a type of heat formable fiberglass composite sheet material called SMC.

The C5 is also easier to manufacture than the C4, as it has 30% fewer components. Around 1500 fewer separate parts.

Oh, and even though it has a 'truck frame', it weighs about the same as the BMW M Roadster, has a solid roof and rear glass, has more hp, and gets better gas mileage.

Beyond Saving wrote:
Of course, the American demand for larger cars is part of it.

Very much so.

I saw a stat a number of years ago that between 50 to 55% of all new vehicles sold in the US, are pickup trucks. I don't remember if this included SUV's, but I was astonished when I read the number.

Beyond Saving wrote:
Until the recent spike in gas prices, most Americans wanted large vehicles (remember the Hummer craze?) Now that more people are demanding high gas mileage, car companies might go through the expense to get some smaller vehicles approved by the government.

The government is not what is preventing small cars, or better engineered, lighter cars.

In Europe, the trend towards transportation, is completely different, overall, than in North America.

In Europe, mopeds are extremely popular for commuting, particularly around the city.

I remember my visiting my cousin in Sweden, over 18 yrs ago. He was driving a 1.1 L Ford Escort, and fuel was over $2.50 a liter US.

He just about fell over when he learned what the average displacement was for 8 cyl engines in North America.

 

I keep asking myself " Are they just playin' stupid, or are they just plain stupid?..."

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