CELEBRATING THE FIRST YEAR OF TRUTH!
We began the TIW Blog on 4/25/06 as a place to express political and religious opinions. It’s turned out to be a little more than that, as any of our readers can tell. We’ve enjoyed a lot of the comments that have been left and we always enjoy a good debate.
Just for fun, here’s the first post after we began. It concerned skyrocketing oil prices:
Politics and Oil Part 1
I am just about fed up with this “high gas prices” stuff. The way prices have increased lately have noticeably hindered our family’s lifestyle. Perhaps what aggravates me the most is all the conservative pundits that bend over backwards to excuse the oil corporations’ complicity in the problem. They say that this is a free market supply and demand issue. While I am in favor of free enterprise, we must note that the oil business does not operate under free market principles. I went over to http://www.answers.com to find out exactly what is meant by the term “free market:” free market n. An economic market in which supply and demand are not regulated or are regulated with only minor restrictions. The fuel market is intensely regulated by the American Central Government. The cost associated with compliance itself is enough to preclude entrance into the marketplace. Acquisition costs of land, drilling rights, equipment, etc. are also prohibitive. Therefore, only a select few can participate in the business of delivering fuel to American consumers. Consider also that oil is an essential element to American life. Just as we cannot function on an individual level without food, water, sewer, and electricity we cannot function without oil. While the market is fairly competitive in the food supply, we recognize that the free market cannot be applied to essential utilities. Why? Because practical considerations make competition in those markets a virtual impossibility. Go ahead and build a water system to compete for service to homes in your city. It won’t work! The regulations for starting up such an enterprise are prohibitive, so no competition exists. Now, let’s look at the free market operation on groceries. Suppose I shop at Bilo on a regular basis. Now, suppose Bilo increases their prices to the point I become unhappy. If I were buying yogurt, I might change from Yoplait to Southern Home to save money. Then again, I may just go to the Walmart Super Center where prices are less. If too many people stop buying at Bilo, the prices will go down if the company wants to remain in business. Similarly, the prices at Walmart will eventually increase seeing that demand is up. We now revisit the fuel business. Exxon raises prices too much, so I decide to go to the Hess station. The price there increases so I try to go to Murphy USA. What do I find out? The price per gallon of gasoline does not vary more than 5 or 10 from station to station. Why is this? Because only a few gasoline suppliers exist. Those suppliers get oil from an even smaller selection of distributors which get oil from still fewer oil producers. The prices are extraordinarily high, yet I purchase the gasoline anyway because without it I cannot work, educate my children, buy food, visit friends, etc. So we find that there is very little effect consumer demand has upon the price of fuel. We might say that the price of gasoline is inelastic: regardless of price, the demand will remain approximately the same. Those who suggest that the oil companies’ profit margins remain the same. This also is a spurious argument. Most people probably could understand price increases based on increased cost. That in both dollars and percentage oil companies’ profits are soaring exponentially is evidence that they are increasing prices at a rate that is greater than their increasing costs. This is taking unfair and immoral advantage of their closed market to economically rape the American consumer. TO BE CONTINUED….
What we didn’t know, however, was the extent of SPAM directed to blogs: a problem that we’ve had to deal with on an almost daily basis. We’ve finally got the SPAM under control, but in the process, we understand that we have limited the ability of some legitimate users to share their thoughts here. In fact, we have turned commenting off as a default condition of our posts, so now, we expect very few comments online, but you can still send them in via email.
The software powering this blog was changed in November 2006, so if you want to see some of our earlier material, you can view it in the archive by clicking HERE.
