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Congressional Humbug on fuel prices
Today's email brought the newsletter from Congressman Elijah Cummings, who represents at least some of the people in the 7th District of Maryland, where I live.
Claiming concern about the price of gasoline, Mr. Cummings reports that he supported "H.R. 2264 to authorize the Justice Department to take legal action against state-controlled entities of the Organization of the Petroleum Exporting Countries (OPEC) that participate in conspiracies to limit the supply or fix the price of oil. " Now, you and I know that "legal action" against some middle eastern sheik stands about as much chance of making a difference as passing another gun control law does of keeping crooks from using guns. But the Congressman has some constituents who will always support him because of racial identity politics, and those are the people he panders to. Unfortunately, many of them are not the brightest bulbs on the tree.
The congressman also co-sponsored "The Federal Price Gouging Prevention Act, H.R. 1252, which would give the Federal Trade Commission (FTC) the authority to investigate and punish companies that artificially inflate the price of gas." Again, this sounds impressive, but the other side of the anti-gouging coin is often some outlawing of what politicians call "predatory pricing," under which the governments often set minimum mark-ups from wholesale to retail. It does not take a lot of online research to discover that a fair number of filling station operators have been regulated clean out of business by government interference of one sort or another.
With all this in mind, I sent the following email to Mr. Cummings. It will be interesting to read his reply, if he bothers:
Mr. Cummings, while your expressed desire to "do something" about the increases in fuel prices since 2001, I think you have neglected the most easily-enacted step: REDUCE TAXES.
At 23.5 cents per gallon, Maryland's state tax on gasoline is above the median for the country. Only 17 states charge more. When you combine that with the 18.5 cent federal tax, it's obvious to anyone how much room there is for price reduction.
By contrast, many of the measures that you support will cost money to implement, meaning the government will need to find additional revenue somewhere. If not increased taxes of fuel, it will be somewhere else.
You say that you "questioned key oil industry experts regarding the lack of adequate refineries, the need for alternative fuel resources, and the need for increased competition in the oil industry."
That's fine, but are you in favor of making it easier for new refining capacity to be built? Every year, for at least the past 8 years, more than 15 million new motor vehicles have been sold in the USA. It's a safe assumption that only 1/3 of them are replacing vehicles that have been junked, so you could safely assume there are 70 million cars and trucks consuming fuel than there were when President Bush took office. (Since you like to use that as a convenient, if not partisan, milestone.) In that period of time, not a gallon's worth of new refining capacity has been added.
Over that same period of time, international relations have worsened, yet you and your Democrat cohorts have steadfastly resisted the notion of oil exploration in ANWAR. This makes no sense whatsoever, in the following context: You and others have opposed new energy capacity such as the AES liquid natural gas facility proposed for Sparrows Point, and the fuel alcohol plant now operating there. Your rationale has been to "protect" people from potential risk. Yet, you resist exploration in ANWAR, where almost no humans live. So just what location IS "safe" and "acceptable" enough for your standards? It would appear, none.
Increased competition: With refinery capacity stalled, and your proposal to "roll back subsidies" for oil companies, who could afford to enter the market to compete? God help us, I hope you are not proposing that the government itself get into the energy business.
As for alternate fuels, people have been kicking around various ideas for at least the 35 years I have been following this. There's been no genuine progress (although a lot of promises) on fuel cells. Most states refuse to license low-speed vehicles. E-85, ethanol, methanol and hydrogen have proven themselves to be economically infeasible. Battery-electric vehicles have not caught on.
The only change in what's available to the consumer has been the hybrid-electric vehicle, which in the lexicon of the computer industry can best be described as a "kluge." They are too expensive, available in too small a range of vehicle types, and ridiculously complex.
Meanwhile, much of the rest of the world gets along fine using lighter weight, less complex vehicles, because you folks in Washington insist on ever more absurd complexities such as multiple air bags, and the requirement that air bags provide "protection" even for passengers who are not properly buckled into their seat belts.
You, and the rest of congress, merit a ZERO on these issues.