Tuesday, July 11, 2006

I'm going to invent a car that runs on bullshit

Here's a short list of some of my main suppliers:
Sen. Rick Santorum: No, it's not my view that (oil companies) are the villains here. I think this is clearly driven mostly by supply and demand; that doesn't mean that there aren't isolated cases where this is a problem...

J. Bennett Johnston: In an exclusive debate on "This Week with George Stephanopoulos," Sen. Chuck Schumer, D-N.Y., faced off with former Senator J. Bennett Johnston, D-La., now a spokesperson for the oil industry, on the issue burning a hole in American pocketbooks — rising gas prices.

"It is the iron law of supply and demand," said Johnston. He cited Hurricane Katrina, the war in Iraq, and boiling tensions with Iran, not the oil industry, as the source of rising rates.

Thomas Sowell: "These repeated investigations over the years have repeatedly failed to turn up anything other than supply and demand."

Michael Reagan: "Despite the spurious claims of price gouging by the wicked oil barons or OPEC or your corner gas station, the reason for the present high price of gasoline is simply this: there are too many people consuming gas supplies and too little gas to meet the need. That’s called the law of supply and demandand no matter how hard the Marxists running the national Democrat party try, it’s a law they can’t repeal."

Mort Kondracke: "And you know, and it’s basic economics, which, you will know that if the supply goes down and the demand goes up, that the price is going to go up."

Rush Limbaugh: "The immediate problem is not price. The immediate problem is supply -- and when you interrupt supply, that means you have less of it; the law says the price is going to go up, and that's exactly what's happening."
The truth (which seems to get less coverage):
Senators Carl Levin (D-Mich.) and Norm Coleman (R-Minn.), Ranking Minority Member and Chairman of the Senate Permanent Subcommittee on Investigations, today released a Subcommittee staff report finding that market speculation has contributed to rising oil and gasoline prices, and that too many energy trades are occurring without regulatory oversight. The report recommends that Congress enact legislation to close a major loophole in federal oversight of oil and gas traders, slipped into law in 2000 at the behest of Enron and other large energy traders...

Although these high prices are often attributed to the forces of supply and demand, the report demonstrates that supplies have been more than adequate to meet demand. Since late 2004, the amount of stored oil in the United States has been increasing. Oil inventories recently reached 347 million barrels – an eight-year high and the largest U.S. inventory since 1998, when oil was $15 per barrel. Similarly, oil inventories in Organisation for Economic Co-operation and Development (OECD) countries recently reached a 20-year high. As the report explains, the traditional factors of “supply and demand” do not tell the whole story on oil and gas prices.
More from the Nieman Foundation.

Update: A reliably conservative friend of mine sent me this:
Can the other white meat's manure make black gold?

They say you can't turn a sow's ear into a silk purse, but University of Illinois researchers are working some interesting magic at the other end of the animal.

"We are the first to actually do this," professor Yuanhui Zhang says proudly of his team's ability to turn swine manure into crude oil. He's a bio-environmental engineer at the University of Illinois Urbana-Champaign who has led the 10-year research project that recently announced a breakthrough in porcine petroleum.
We're getting there...

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