by Jim Tankersley
Congress returns to work next week with an enormous national outcry to address: the rising cost of gasoline, which polls show has surged to the top of voters' minds.
The political parties in Washington are pushing very different proposals they promise will bring relief at the pump. Republicans want to expand domestic oil drilling, a plan many Democrats and other critics say wouldn't affect gas prices for years because of delays in bringing new supply out of the ground and to market.
Democrats are focused on a package of measures to crack down on what they call price-inflating abuse of the oil market, including price gouging and oil speculation. "Increasing evidence shows that the run-up in crude oil prices and gasoline is being driven by larger trader banks, pension and hedge funds," Sen. Dick Durbin (D-Ill.) said last month. Speculation may have as much, if not more, to do with high gas prices than any Saudi Sheik."
An article in the July 7 issue of the New Yorker magazine rebuts Durbin - and, to a lesser extent, the Republicans - with a simple argument: that the real cause of soaring gas prices is too complicated for Congress to do much about this summer.
"The difficulty for Congress, of course, is that none of the problems that have driven up the price of oil lend themselves to a quick fix," the New Yorker's James Surowiecki concludes, "and most, like the boom in global demand and the inaccessibility of certain oil fields, aren't under our control at all... Our dependence on foreign oil, together with the fiscal fecklessness that has helped reduce the value of the dollar, means that there is no easy way out of where we are. But in an election year that's hardly a message that anyone in Washington is going to deliver."
Check out the full article here.
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Comments
These changes in the price of gas do have many causes, but the core of those causes is uncertainty. This uncertainty, created by the actions of the Bush Administration's middle east policies, e.g. Iraq, Afganistan, overt saber rattling against and covert ops in Iran. With that uncertainty, te focus then moves to the value of the Dollar. Oil is priced in Dollars. Iraq, Iran and others have threatened to not price Oil in Dollars. Oil has, since after the move from the Gold Standard, behaved as a hard backing to a Dollar not backed by anything. If the Dollar is no longer effectively backed by Oil, our economy is seriously toast. This is the underlying reason GWB & Co. want to conquer this region - that and obscene profits.
-C
Posted by: chris | July 3, 2008 11:30 AM
An especially interesting observation coming from Surowiecki, whose wife, "Slate" editor Meghan O'Rourke, proudly proclaimed (like everyone who writes for Slate--they have the same kind of "diversity" the Swamp staff has) that she voted for John Kerry in 2004. See http://www.slate.com//id/2108714 for Ms. O'Rourke's money quote: electing John Kerry "will help America seem American to me again." Yes, to people like that America isn't "American" unless it has a Left wing Democrat as president.
With a spouse of those opinions, no wonder Surowiecki is quoted in the Swamp!
Posted by: Typical Democrat | July 3, 2008 12:03 PM
Thanks, Chris, for presenting the facts, though I'm sorry to say that most people won't understand them or even try to. They want to wave their flags and proclaim how proud they are to be American, but when it comes right down to it, the one they need to blame for high oil prices is facing them in the mirror.
Posted by: DD | July 3, 2008 12:13 PM
The political parties in Washington are pushing very different proposals they promise will bring relief at the pump. Republicans want to expand domestic oil drilling, a plan many Democrats and other critics say wouldn't affect gas prices for years because of delays in bringing new supply out of the ground and to market. ~ J.T.
The "hope" is that it would take some of the starch out of the traders / speculators enthusiam for running up the price on the futures market. Some "experts" seem to think that it would have an immediate impact, some seem to think that it won't, but at some point it would. How would someone of the Dick Durbin ilk really know. When will he be presenting his "evidence" ?
If I had known that it was going to take 12 whole years to get through grade school and high school, I would have insisted on not ever starting. After many starts-stops-starts, I secured degree no. 2 in math. Never would have engaged in that somewhat painfully affair either, if I had fully / consciously considered the time factor. Where are those fuel cell / solar cell / electric / wind / vegetable oil / oily rags / water powered cars right now? What kind of inane argument is this anyway? What would the great Obama advise that consumers of motor fuel "hope" for?
We seem to have moved beyond investigating ExxonMobil, Shell, Chevron, and BP to investigating the oil traders / speculators. Now that's progress.
Is this not a great country or what
Posted by: Django Scott - Houston, Tx | July 3, 2008 12:16 PM
They're all leaches. The speculators produce nothing. They add nothing. They simply live off the work of others. So much for the american work ethic. They are far worse than they mythical "welfare queens" the Republicans like to complain about.
Posted by: margaret | July 3, 2008 12:37 PM
"KEN LAY SPEAKS"
THE DEVIL MADE ME DO IT!
THE DEVIL MADE ME DO IT!
"PHIL GRAMM MADE ME DO IT!"
"PHIL GRAMM MADE ME DO IT!"
JUST DO IT!
JUST DO IT!
101 DAYS IN A ROW!
JUST DO IT!
101 DAYS IN A ROW!
ENRON MADE ME DO IT!
ENRON MADE ME DO IT!
DICK CHENEY MADE ME DO IT!
DICK CHENEY MADE ALL OF US DO IT!
JUST DO IT!
DO IT HERE, DO IT THERE,
JUST DO IT!
101 DAYS IN A ROW!
101 DAYS IN A ROW!
IT'S NO "OCCIDENTAL"
OVER HERE! IT'S NO "OCCIDENTAL" OVER THERE!
JUST DO IT! DO IT, DO IT DO IT TO EVERY AMERICAN IN NEED OF OIL!
JUST DO IT UNTIL YOU SEE "ELVIS" IN THE "ROSE GARDEN"
Posted by: Roger Morris | July 3, 2008 1:37 PM
It is amazing we can go to Mars yet we don't have enough money and fuel to get around in USA....What is wrong with this picture??
Also why are we begging Israel not to bomb Iran??How bout we DEMAND THEY DON'T BOMB IRAN...What Country is in charge here of what decisions we make or are let ourselves be drawn into...??We have more than enough of our Soldiers dying at present for no good reason other than Bush and Chenay's make believe wars...We'd best do everything we can to get a Democrat elected this time as our Country cannot stand much more. We are fast going to HE** in a handbasket. Too bad Bill Clinton can't be President again. He could straighten all of this out and bring our Soldiers home and get the economy going good again. Where a man could work if he would as the song goes...Woemn,men teens. Anyone that wanted a job got one when Bill Clinton was in office. We were prosperous..There has to be a loophole. Let's find it and elect him again for the good of our Country. GOD BLESS AMERICA.... I hope I get this published . Many times I get ousted off.
Posted by: kaye c. | July 3, 2008 2:27 PM
As I heard on NPR this morning. Oil is a worldwide commodity. If you dry up speculation in the US, they'll just speculate in overseas markets. You have to get all countries to agreee to stop speculation or you get nowhere.
Posted by: lochnessmonster | July 3, 2008 4:35 PM
chris,
You are completely full of crap. I am sick and tired of all of these idiot economists coming up with all of the fluid laws about the "market". All of you greedy, filthy jerks hide behind "the market". It seems that every day a new excuse is dreamed up by these incredibly intelligent "economists" for new record oil prices. Let's just try gathering up 20 or 30 oil and gasoline speculators and throw them into a big hole along with 20 or 30 of their "economist" friends and set them on fire. Wanna guess what will happen to oil prices?
Posted by: tromba | July 3, 2008 7:13 PM
And guess what these speculators are speculating on? The future supply and demand of oil. It always boils down to supply and demand.
Posted by: Terry | July 3, 2008 9:14 PM
Ultimately the consumer is the problem here. Most of us are old enought to remember the 70's gas lines. This was a wake up call. And yet, we continued to prosper in an oil driven economy. Well the piper is in town and he's collecting. If anyone believes that any one president is going to solve this problem, you're living in the world of OZ. This is a consumer driven market and the consumers can drive change. Consumers need to look at non-oil based solutions.
In my mind this is simple and solves the oil based problem however no matter which solution is adopted and embraced by the consumer, it will take time to implement.
So why not build new Nuclear power plants on these aging and abandon military bases? Lets use the energy to produce hydrogen. Then evolve our oh so precious SUV's to hydrogen fuel cell based???
Trying to solve the oil and gas crisis with oil and gas solutions only prolongs the inevitable. Which will get worse over time. This problem requires a paradigm shift into a new way of thinking and it has to start from the American consumer.
Posted by: John | July 4, 2008 8:56 AM
The big money oil speculators have their sources. Here and abroad.
Actually, some of it is "open source" . When Charlie Black states an attack would be "good for McCain" that's not just a slip of the tongue.
That's an open grant of permission.
When the Admiral made that speech Wednesday in Dubai "warning" Iran not to close the Straits, the understood but not stated premise of that remark was:
"When you are bombed by Israel..."
don't try to retaliate by closing the Straits.
Will Iran heed that warning, and settle for having its agents in US blow up the Red Line??
Oil speculators are bettting Iran will close the Straits. Think of the money they'll make!
Posted by: ornery | July 4, 2008 1:21 PM