[ame="http://www.youtube.com/watch?v=_SlVtcv1KVE&feature=g-u-u&context=G28d8ca0FUAAAAAAACAA"]Tax Breaks and Gas Prices - YouTube[/ame]
Yes - the idea that raising the tax breaks for large oil companies will actually lower gas prices is absolutely stupid. BTW - I DO NOT agree with tax breaks for ANY industry (except during a time of a major declared war). But IF among the reasons that Obama is proposing to eliminate tax subsidies to oil companies is to lower gas prices, then he (or whoever is advising him on this) is an economic ignoramus.
Agreed....... People are clueless as to why gas prices are rising. The reasons are all of our own doing. Intervention in the ME plus debasement of the dollar. It really is pretty simple. Get out of the ME and increase the purchasing power of the dollar.....gas prices plummet.
I've grown real tired of all the "simple solutions" to fix the price of a gallon of gasoline. It's a multivariate problem with issues on both the supply and demand side, the notion that simply increasing demand will have any substantial impact is crap... at best. The demand for oil/energy is increasing rapidly, the supply is "fixed" and if your betting on oil futures, you have every interest in pressuring speculators to ramp up the price.
Is kinda like the AMA havin' a choke-hold on the number of medical schools which limits the number of doctors... As refineries close, experts say U.S. gasoline shortage may strike during peak driving season Friday, March 23, 2012, A rising number of oil refineries have closed along the East Coast. See also: Critics rip Obama claim that drilling in U.S. won’t drop gas prices Thursday, March 22, 2012 - President Obama has been touring the country this week touting increased oil and gas production numbers during his time in office — but his selective quotes and figures tell only part of the story.
'Strangely, the current run-up in prices comes despite sinking demand in the U.S. Petrol demand is as low as its been since April 1997, says Tom Kloza, chief oil analyst for the Oil Price Information Service.' http://www.businessweek.com/articles/2012-02-15/rising-gas-prices-not-demand-driven
Have we become that myopic? Oil is a global commodity, global demand has been on the rise since at least the mid-90's.
It has been more or less flat since the mid-2000's. http://www.indexmundi.com/energy.aspx It's like headhawg7 said - oil is going up because of Middle East tensions and America devaluing the dollar (since almost all oil is priced in U.S. dollars). Sure, long term demand will push up prices as Peak Oil approaches. But the idea that oil has gone from about $38 per barrel in December '08 to over $100 per barrel today because of consumption is totally wrong - since consumption has barely changed since then. http://www.nyse.tv/crude-oil-price-history.htm If Americans want cheaper gas? Just get the government to a) stop 'printing' SO much debt and b) stop militarily budding in all over the world (especially the Middle East). if they do that - prices will fall drastically...guaranteed.
Correct....prices are NOT rising because of demand. Demand has been pretty stable. However...what has not been stable is the currency that oil is priced in. Get out of the middle east all together. Stop the meddling. Stop debasing the dollar. It is really simple.
Yep, has little to do with demand, and pretty much all to do with the dollar and an unstable mideast. But Obama wants to blame the oil companies and the sheep will follow. It doesn't take a brain surgeon to understand that taxing a company more will lead to higher prices, not lower. However, being self-dependent and foreign dependent are completely different issues. It's much better to produce and use within the country (or even continent), than it is to import, but that's a different topic all together.
better yet....fire bernacke and raise interest rates....gasoline would be back to 2 dollars a gallon in less than a year!
Kinda funny how when Congress gets together to talk about ending oil company subsidies... ... gas prices go up an' don't come back down till the motion's tabled... ... kinda like gas prices and holidays... ... prices go up a couple days before a holiday... ... an' don't come down fer a couple of weeks.
If the government raised taxes on natural resource ownership then speculators would leave that market and this would relieve scarcity, and the pressure on prices. The supply of raw crude oil is fixed, taxing owners (not producers) more cannot reduce the supply, so it cannot increase scarcity. Id bet that the large profits of oil companies at the moment is due in large part to their ownership of in ground reserves or favorable leases which are set below market value. These could be taxed heavily and it would most likely lower gas prices.
the bank stooges think we can print until we revive debt based consumerism, and our incomes outpace the rise in cost of necessities, despite having a country of underwater collateral against which to borrow. ........Good luck. Bernanke will do nothing but print. The banks will never allow their $600T in dollar based derivatives to collapse. Hundreds of millions will die in useless wars before that happens.
You realize that U.S consumption of gasoline is the lowest in about 15 years? Scarcity is not the problem. How could taxing oil companies more, lower gas prices? These companies will want to recoup these tax losses - will they not? And how will they probably do it? By raising the cost of oil/gas they sell. Surely, you do not think they will just eat the extra cost and tell their stockholders - 'Oh well'?
In a market economy price is a reflection of scarcity. If it is not free then it is scarce. Im not talking about taxing oil companies for production. Im talking about taxing the natural resource owner. If government taxed in-ground oil reserves then the owners of those reserves would have to pump the oil in order to pay the tax. Imagine that you own a piece of land with undiscovered oil reserves. The current taxes on that land are $1,000 per year. Now it is discovered that there is a large pool of oil under the land that you own. As a result of this discovery the government increases your tax bill to $100,000 per year. Those taxes are due whether you pump the oil or not. Now are you going to eat that tax bill year after year at your own expense? Or are you going get someone in there to pump that oil out of the ground so you can use the income to pay the tax bill? If you dont pump you go broke. If you do pump then the taxes are easily affordable. What would you do? Now can you see how such a tax (on natural resource ownership) would help bring prices down? Such a tax (land value tax) actually has a great deal of support from economists as a replacement for the current tax systems: http://www.wealthandwant.com/themes/quotable_nobels.htm
You are still missing the point...America is EXPORTING gasoline. Meaning she already has more then enough. Again, the demand is as low as 1997. A weak U.S. dollar is the primary reason oil is $100/barrel...not primarily supply/demand problems. And oil costs the same per barrel almost everywhere in the world...and yet oil is almost triple what it cost in Jan. '09...yet demand is about the same. http://www.nyse.tv/crude-oil-price-history.htm The reasons are primarily a weakening dollar and secondarily Middle East tensions.
what you just explained above is classic stagflation.....weak demand with rising prices....welcome to the 70's
