Windfalls and Hot Air

This really chaps my hide:

Oil Company Execs Defend Profits to Senate

“Oil executives sought to justify their huge profits under tough questioning Wednesday, but they found little sympathy from senators who said their constituents are suffering from high energy prices.
"Your sacrifice appears to be nothing," Sen. Barbara Boxer, D-Calif., told the executives, citing multimillion-dollar bonuses the officials are receiving amid soaring prices at gasoline pumps and predictions of more of the same for winter heating bills.
There is a "growing suspicion that oil companies are taking unfair advantage," said Sen. Pete Domenici, R-N.M. "The oil companies owe the American people an explanation."

The government is investigating ‘big oil’ for making money. Did they want companies to loose money? Or perhaps just break even?

It’s true that oil companies are making lots of money right now. That is because demand is high and supply is relatively low. When supply is higher and demand lower, they don’t make so much money. That’s the free market. The recent hurricanes in the gulf disrupted supply. Because demand remained roughly stable, the price should increase until consumers decide to decrease consumption to meet the level of supply. This is simple economics.

What angers me is not so much the public’s frustration with the oil companies (although if they really wanted to offset or even profit from the high price of oil, they could just purchase stock in ‘big oil’!) as Washington’s deceit in blaming ‘big oil’ for ripping off consumers. The truth of the matter is that it is ‘big government’ that has been gauging consumers for years, much more so that the oil companies. Government’s profits over the sale of gasoline have far exceeded corporate profits for the last thirty years. These are nothing compared with Europe. We currently pay around six dollars per gallon for gasoline in the United Kingdom. Oil company profits are more or less the same as in the States; the vast majority of the price difference goes to – you guessed it – government. And now, while complaining that high gas prices hurt consumers, politicians are simultaneously proposing a ‘windfall tax’ on ‘windfall profits’. Are they really out to protect consumers or to increase their own budgets?

http://www.taxfoundation.org/publications/show/1139.html

Source: Bureau of Economic Analysis, U.S. Energy Information Administration

There appear to have been illegal cases of price gauging in places such as Atlanta during Katrina which should be prosecuted. Any national investigation of gasoline prices, however, would be incomplete without an investigation of government’s price gauging. That means you, Sen. Boxer.

http://www.suntimes.com/output/business/cst-fin-wind07.html

Helping the good people of France

German interior expansion minister Horst Schnellpanzer announced this morning that high government officials had crafted a plan to restore order to their beleaguered western neighbor. France has entered its second week of urban riots, its top leaders scrambling to capitulate as civil unrest spread from a northern Parisian ghetto across the entire cheese-loving nation.

“France is a great nation,” Herr Schnellpanzer declared, “They have good wine, licentious women, and a towering mass of inexpensive, accessible iron. It is a great place to make your holidays.”

The riots began after several North African teenagers, fleeing from the police, launched a suicide attack on French power lines in an apparent attempt to disrupt power and thus precipitate the downfall of western civilization. Neighbors and relatives were outraged by the youths’ deaths, claiming that the wasted martyrdom did not kill any Jews or Crusaders and would therefore not merit more than forty seven virgins in paradise. They decided to take action, hoping that their car-burning and trolley-torching merits could be applied to their dearly departed loved ones through the Communion of the Terrorists. Other immigrants throughout France, confounded by the fact that the French only wanted them and their children to sweep floors and clean dishes, decided to join in the fun. French president Jacques Chirac immediately called upon British and American to come to France’s aid. Bush and Blair declined, citing that Chirac had been a “bloody bastard” during the 2003 invasion of Iraq.

"Not to worry" declares Schnellpanzer. "Germany will soon control ...ich mein... help France control the problem with Blitzspeed."

Douglas and Rachel’s wedding

Morag and I went to Douglas and Rachel’s wedding over the weekend. Rachel is from Shropshire so they held the wedding there at her tiny parish church in Woolstaston. Luckily I was able to get the weekend off work, so I headed down on Friday night and met up with Morag at Church Stretton. The older Tudor buildings in Shropshire are timber framed and resemble magpies in their dark wood and whitewashed exteriors. The roads out in the countryside surrounding Woolstaston were barely wide enough for a single automobile and were bordered by seven-foot hedges on each side! It was actually safer to drive on them at night because you could at least see the headlights from the oncoming car. However this still left the challenge of one car backing up for considerable distance to let the oncoming traffic pass.
The wedding itself was lovely. The church was a recently restored country parish, complete with a set of ropes for ringing the bells at the end of the nave. Douglas’ uncle, who is a Church of Scotland minister, reversed the readings from Paul’s epistle into a warning on how to ruin your marriage. Morag and I agreed that this was much more relevant to us after six months of marriage than it would be to the actual couple. The wedding took place on Saturday, which was Guy Fawkes night, and the four-hundredth anniversary of the failed attempt to blow up the king and parliament at that. I suspect that the reason for that date was so that Douglas could ‘remember, remember, the fifth of November’ and have fireworks every year on their anniversary, but seeing as we managed to get married on St George’s day I should withhold any comments. The music was surprisingly good, with a local band playing Ceilidh/Barndance music followed by a younger band which played songs by the Beatles and even ‘Sweet Home Alabama’ with skill. Having said that, there are few things in this world that are more pathetic than a bunch of English people trying to Ceilidh. Bad things happen when one side of the dance floor dances clockwise as the other side dances counter clockwise. It just doesn’t work, folks! In the end, however, it was a good evening.