More Profiteering by Bush's Supporters

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Do you think the Energy sector should Allowed to make absurd profits on daily necessities like electricity, gasoline, gas, and heating fuel?

Yes, Let them rip us off and manipulate the market like Enron
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No, Regulate the essential we need with a fair profit margin
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More Profiteering by Bush's Supporters

Post by sbheg »

Below you will find another instance of how Bushes supporters are making out. His message is Go with ME and I will grow you bushes of money! Quite evident by how he has disrupted the world’s oil supplies allowing for the types of manipulation and excess profit making by his largest supporters.
Then there are all the defense companies that are doing awesome too.
NEW YORK (Reuters) - Exxon Mobil Corp., the world's largest publicly traded oil company, on Thursday said quarterly profit surged 56 percent, driven by soaring oil prices and strong results from refining operations.
Despite the stellar results, the company's shares fell a bit in afternoon trade, held down by a weaker oil and gas sector as crude prices slipped.

Crude, which shot up 60 percent this year due to fears of supply disruption in countries like Nigeria and Russia coupled with demand from growing economies like China and India, produced a windfall for oil producers. It recently peaked at $55.67 a barrel. By Thursday afternoon it was under $52.

Exxon's third-quarter net income jumped to $5.68 billion, or 88 cents a share, compared with $3.65 billion, or 55 cents a share, in the year earlier period.

Excluding a $550 million charge related to a lawsuit, the company reported record earnings of $6.23 billion, or 96 cents a share that beat Wall Street forecasts of 87 cents a share.
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Post by Rekd »

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Post by Sue Davies Laird »

so.. this is the Presidents fault then?
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Post by Voice »

Of course it is... The war in Iraq was for oil!
It's also Bushes fault that China and India are developing a booming "Consumer" economy.
Let's not forget that it's Bush's fault for all the political unrest in South America which has caused fear of oil shortages.

Besides, we all know that Saudia Arabia sets the price in OPEC and Bush is best buddies with Prince Bandar.
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Post by L&L Corvairs »

Sorry, but IMO, the high energy prices are not the fault of the President (Bush OR Clinton). We (meaning the citizens of this country) have created our own mess. The United States has PLENTY of oil reserves….

…in Alaska and off the coast of California. But we pulled out our own weenie and stepped on it….it’s called ‘Environmentalism’ We can’t DRILL for the oil we have. The rest of the oil producing world has to be laughing at us, as they get rich on our money. Someday, hopefully, that will change.


OH, yeah...'Nationalizing' our energy companies is one of the major steps toward Communizium\Socialisum\Dictatorship. That, along with LAND CONTROL. The argument will be..."Well, controling the energy companines is good, so.....lets do it for food....and since it is good for energy and food, lets do it for housing,.....and since it is good for energy, food and housing, let do it for....etc.....

Each according to his ability and each according to his need. :wink:

Before I add MORE regulations to our energy companies, we should REMOVE the existing restrictions on their ability to find and produce more oil and build reifneries in this state.

JMO
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Post by sbheg »

L&L Corvairs wrote:Sorry, but IMO, the high energy prices are not the fault of the President (Bush OR Clinton). We (meaning the citizens of this country) have created our own mess. The United States has PLENTY of oil reserves….

…in Alaska and off the coast of California. But we pulled out our own weenie and stepped on it….it’s called ‘Environmentalism’ We can’t DRILL for the oil we have. The rest of the oil producing world has to be laughing at us, as they get rich on our money. Someday, hopefully, that will change.
I personally have never understood the reasons for not drilling on our own reserves. I agree that we could have more oil and lower prices. But that is not a long term solution.
L&L Corvairs wrote:OH, yeah...'Nationalizing' our energy companies is one of the major steps toward Communizium\Socialisum\Dictatorship. That, along with LAND CONTROL. The argument will be..."Well, controling the energy companines is good, so.....lets do it for food....and since it is good for energy and food, lets do it for housing,.....and since it is good for energy, food and housing, let do it for....etc.....

Each according to his ability and each according to his need. :wink:

Before I add MORE regulations to our energy companies, we should REMOVE the existing restrictions on their ability to find and produce more oil and build reifneries in this state.

JMO
I never said nationalization, regulation is different! But why deregulate an industry like electric power. Did you get cheaper energy, how much less then $.03 per kw do you need? How much closer to 0 are you going to get? How much efficiency is the free market going to apply to make a profit and reduce it to $0.015?
The oil companies could be placing the windfalls into the development of renewable energy if their profits were capped. It is too easy to manipulate its scarcity in a unregulated market. It is easy to sell a scarcer non renewable commodity then to developed a self sustaining energy programs for the future. We could be producing bio-diesel instead of paying some farmer not to grow something or the subsidies that are provided to grow unprofitable crops.

JMO
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Post by Voice »

Bio deisel will never sustain this country. Neither will ethenol, wind or solar.
Of those, solar has the only chance. I've seen a suggested system of solar power generating that actually made some sense.

You put solar power cells on top of every roof and use the power in the place it is generated.

Another solar power plan that might work is SPACE solar power microwaved to earth...

Actually, in the short term the best non-carbon based source of energy is Nuclear.

IMO, as long as our society is enamored with the personal vehicle we will be stuck with carbon-based energy needs.
We could work on getting rid of coal and natural and oil electricity plants but the environmentalists wont let us build any nuke plants.

Hydrogen? Maybe our best, long term bet... but we are a long ways away from making that feasable and cost effective.
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Post by Rekd »

I'm still trying to figure out how this is shurb's fault.. :?:
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Post by Crowdog »

The Truth about ANWR

Bottom line is we should be drilling in Alaska but the enviro-weenies want to make you think we'd be killing Bambie and clear cutting huge amounts of trees. :roll:

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Post by L&L Corvairs »

I never said nationalization, regulation is different
Going to respectfully disagree, but I also realize that it is a matter of opinion. :wink: Regulating the profits an industry can generate is just bad economics, regardless of what the ‘commodity’ or product is that is produced. The argument that it is ‘good’ for the consumer means that the ‘consumers’, (i.e. all of us) don’t know what we want or what is good for us, but the ‘government’ does. When the government controls business, it is, to me, just like ‘nationalizing’ an industry. It is certainly the first step. I don’t believe the government should be involved with private business, regardless of the business, ‘for the common good’. It all reeks of Communism/Socialism.

JMO
to make you think we'd be killing Bambie and clear cutting huge amounts of trees.

Personally, I wouldn’t care if we really WERE wiping out Bambi and the large forests. That’s just a TOO BAD. I want lower energy prices without government intervention and I am willing to sacrifice as many ‘species’ as necessary to achieve it, except perhaps the HUMAN species.

All we would have to do is START drilling, and the rest of the world would lower prices in an attempt to KEEP our reserves off the open market by making it non-cost effective to put more oil wells into production. That would be an IMMEDIATE reaction.
The oil companies could be placing the windfalls into the development of renewable energy if their profits were capped.
Finally, I respectfully disagree with this too. Oil companies are in business to make money by producing oil, gas, and oil related products, and profits for their share holders. Period. They are NOT entrusted with developing new/alternative energy sources. It’s not their JHOB MON…..Nor is it our governments job to do so by taxing or controlling oil/energy companies. It’s OUR job. By creating a demand that is un-met. The only government involvement with tax money that I would agree to would be grants or other monitary support to research and development of new energy sources. AFTER, we have a balanced budget.

Again, JMO.
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Post by Rekd »

L&L Corvairs wrote:...I want lower energy prices without government intervention and I am willing to sacrifice as many ‘species’ as necessary to achieve it...
:shock: :shock: :shock:

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Post by sbheg »

L&L Corvairs wrote:
I never said nationalization, regulation is different
Going to respectfully disagree, but I also realize that it is a matter of opinion. :wink: Regulating the profits an industry can generate is just bad economics, regardless of what the ‘commodity’ or product is that is produced. The argument that it is ‘good’ for the consumer means that the ‘consumers’, (i.e. all of us) don’t know what we want or what is good for us, but the ‘government’ does. When the government controls business, it is, to me, just like ‘nationalizing’ an industry. It is certainly the first step. I don’t believe the government should be involved with private business, regardless of the business, ‘for the common good’. It all reeks of Communism/Socialism.

JMO
Well I too have to respectively disagree, it is not a true free market when it comes to energy, when you control supply by not running at capacity, because I can make less and charge more.

You think it is good economics to have inflated profiteering at the cost of the consumer, which means we have less money to consume which is what makes a consumer economy work.

Deregulation of electric power in CA. Hmm, I liked paying 0.035 cents a KW, never see that get even close again. Put into motion by Pete Wilson, disastrously executed by Gray Davis, did Pete and Gray ever talk while Pete was the governor? Davis was like a deer with head lights running him over on the debacle of a deregulation policy that was doomed from the start. Why does it cost me more today in a free market, then in a regulated market? The utilities made fair profits and share holder received their dividends.

One other issue I must respectively disagree with you is that regulation is in any form related to communism or socialism, regulation does not provide a right nor a benefit to an individual, but knowledge that on essential commodities that are needed today like energy, water, sewage you the consumer can be assured these business with limited monopolies are not abusing their power.

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Post by airkuld »

Gosh, I hate to find myself agreeing with SBHEG, but I do. All the arguments about free economics and goverment staying out is best for all consumers does apply to markets where there are minimal restrictions or barriers.

But in the case of the energy industry, that's not the case. The goverment is already in the business model big time. The problem is that the goverment has stifled competition and created a market that can be easily manipulated by the handful of players in it. That market will be manipulated to it's fullest legal extent ( and then some probably) to maximize share price, that's management's job. If the goverment doesn't even out it's heavyhandedness with restricting competition on the supply side with consumer protections on the demand side, the consumer loses big time. That is simple economics.

So I agree with the "let free markets be free", but energy is not even close to being a free market, it's too highly regulated on the supply side to allow new competition, new capacity to enter the market and bring prices down.

The energy industry saw an example of what they could expect wioth the electricity crisis. A wholesale rip off occured, and FERC did nothing to correct it. Far more profits were reaped than were ever recovered through fines, etc. It's a no brainer to try to game the market as much as possible.

You can drill as much as you want, where ever you want, it's not gonna help much. You don't pump crude oil into your car. It's the lack of refining capacity and competition that hurts the consumer.

edit - "legal"
Last edited by airkuld on Tue Nov 02, 2004 1:24 pm, edited 1 time in total.

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Post by airkuld »

The one thing I don't agree with SB on this is, it's not Bush's fault, even though that's the hype nowadays. The government intervention that created this messed up energy market started 20 - 30 years or more ago. The Democrats support most of the enviro group happenings that have made it impossible to build new refineries and have acted in numerous other ways to restrict competition.

They also push all of this alternative fuel garbage. Bio-diesel? Don't believe everything you read. Another "Bio" alternative, ethanol is a good example of the hype behind these products. The massive subsidies paid to corn farmers are there primarily to support ethanol, another "wonder fuel" thats a flop.

Alternative fuels are way more expensive to produce and way less efficient in being converted to useable energy than gasoline. They will not become a viable alternative until the cost : benefit ratio of gasoline is equivalent to the alternative fuels. It's that simple.

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Post by sbheg »

airkuld wrote:The one thing I don't agree with SB on this is, it's not Bush's fault, even though that's the hype nowadays
I'll tell you what Bush has to do with it in my mind, is that when it was obvious that abuse was going on he did nothing to stop his good friend Kenneth Lay from ripping off CA. Enron employees got what they deserved, lost their jobs, 401k’s and pensions due to the greed of their leader Kenneth Lay, the guy that Cheney worked with to dream up our energy policies, that Cheney will not make public due to how it might embarrass the administration. I do not feel sorry for any Enron employee they are all criminals in my eyes. They knew they were going beyond the gray line of ethics and could care less, because they were all making money on paper with their stock in Enron, so it was okay to look the other way and rip consumers off.

Bush hates CA, because we did not vote for him in 2000 and now in 2004. Bush will not give CA the time of day.


JMO

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Post by sbheg »

I hope not hear how you are all tired of spending so much money on your 91 octane to power your toys, or the cost of towing your stuff out to the dunes. I figure that every trip to the Dunes will cost a minimum of $150 in Fuel. Diesel 60 gallons X $2.45 = $98.00, 91 25 Gallons X 2.60 = $65

14 trips to the Dunes = $2,100.00 just in fuel cost.

I should open a gas station at Buggy Flats :-)

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Post by sbheg »

Lloyd,
No rebutal,
See you this weekend
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Post by airkuld »

sbheg wrote:
airkuld wrote:The one thing I don't agree with SB on this is, it's not Bush's fault, even though that's the hype nowadays
I'll tell you what Bush has to do with it in my mind, is that when it was obvious that abuse was going on he did nothing to stop his good friend Kenneth Lay from ripping off CA. Enron employees got what they deserved, lost their jobs, 401k’s and pensions due to the greed of their leader Kenneth Lay, the guy that Cheney worked with to dream up our energy policies, that Cheney will not make public due to how it might embarrass the administration. I do not feel sorry for any Enron employee they are all criminals in my eyes. They knew they were going beyond the gray line of ethics and could care less, because they were all making money on paper with their stock in Enron, so it was okay to look the other way and rip consumers off.

Bush hates CA, because we did not vote for him in 2000 and now in 2004. Bush will not give CA the time of day.


JMO

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Post by L&L Corvairs »

Harold…..been busy….

Airkuld…you’re making my point for me….don’t need to reply much…
But in the case of the energy industry, that's not the case. The goverment is already in the business model big time. The problem is that the goverment has stifled competition and created a market that can be easily manipulated by the handful of players in it. That market will be manipulated to it's fullest legal extent ( and then some probably) to maximize share price, that's management's job. If the goverment doesn't even out it's heavyhandedness with restricting competition on the supply side with consumer protections on the demand side, the consumer loses big time. That is simple economics.

So I agree with the "let free markets be free", but energy is not even close to being a free market, it's too highly regulated on the supply side to allow new competition, new capacity to enter the market and bring prices down.


For any industry, the more government regulation, restrictions and requirements you have…i.e. the more government involvement, they less competitive it becomes, the costs to consumers increase and are subject to higher fluctuations. No new production is started.
You can drill as much as you want, where ever you want, it's not gonna help much. You don't pump crude oil into your car. It's the lack of refining capacity and competition that hurts the consumer.
Increasing refinery capacity is also part of the problem. But WHY have there been no new refineries built in California in the last…oh…20 or so years? Mostly it is due to environmental restrictions, but also, if there isn’t sufficient oil available to process, why build? We don’t drill for new oil for the same reasons. But consider a regulated energy industry.

What incentive would there be for an existing oil company to build a new refinery? Profits are set and controlled by the government. Ultimately, the government would need to build and operate more refineries to attempt to maintain gas prices at some arbitrary level THEY determine. In an extremely regulated industry, why would anyone want to start a NEW oil/energy company? Competition decreases, as marginal companies can’t expand and go out of business or are bought up by larger ones or the government.

We’re complaining because gas prices are high, and yes, oil companies are making profits. But regulating them isn’t the answer. The answer is to find ways to make it easier for oil companies to produce more gas. That means removing restrictions on building refineries and drilling for new oil. The same is true for any ‘essential’. When we argue that ‘essential’ industries should be controlled by the government, ‘for the common good’, we are asking for Socialism. The list of ‘essentials’ will expand from gasoline to electricity, to natural gas, then on to water, followed by milk, bread, meat, all food items etc in a never ending spiral. Eventually, the government will decide how MUCH of a commodity (like gas) each person NEEDS…..and THAT will expand…..before you know it….

Each according to his ability, each according to his needs……

I said this already..sounds like a broken record.

The American People are extremely selfish in a sense. We use our hard won and protected freedom to ‘grab’ all we can. “He who dies with the most toys, WINS” is a very American type analogy. When people see someone making a ton of money, the first question they ask is…”How do they DO that’. and there is some desire to do the same thing. But government regulations stifle our ability to do that. Why do you think so many jobs and businesses are leaving California? Part of it is our high standard of living, but the other, bigger part, is related directly to how DIFFICULT it is to have a MANUFACTURING facility in this state. And THAT is directly related to the massive amount of California State regulations.

I don’t like the higher gas prices better then anyone else, but I can’t support more government, at the long term expense of our personal freedoms.



PS:
The energy industry saw an example of what they could expect wioth the electricity crisis. A wholesale rip off occured, and FERC did nothing to correct it. Far more profits were reaped than were ever recovered through fines, etc. It's a no brainer to try to game the market as much as possible.


One of the biggest contributing factors to the above is, again, related directly to how difficult it is to build more electrical generating capacity in this State.
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Post by airkuld »

"What incentive would there be for an existing oil company to build a new refinery? Profits are set and controlled by the government. Ultimately, the government would need to build and operate more refineries to attempt to maintain gas prices at some arbitrary level THEY determine. In an extremely regulated industry, why would anyone want to start a NEW oil/energy company? Competition decreases, as marginal companies can’t expand and go out of business or are bought up by larger ones or the government. "

Well, there is no incentive now either. As a matter of fact there is incentive to shut down existing facilities or run them at less than max efficiency to inflate prices and profits by reducing supply. I believe all your principles above, but they just don't apply in a market severely restricted on the supply side. By setting a max allowable price for the refiner's sale of fuel, you would create incentive to run at max efficiency and produce as much as you could in order to maximize your allowable profit margins. People would always pay roughly the same price for gas, but there would be plenty of it and it wouldn't be subject to wallet flattening price spikes.

Remember, when electricity went out of control all the pundits said "no,no, there's no problem here, just the market working". Well, there was a problem. Just like the electricity people, the smoking gun is in the financials. If economic principles were working, refiner margins would rise and fall more closely in time with crude price fluctuations. Instead the refiner margins have been steadily and quickly rising at an accelerated pace, regardless of crude prices. This set of circumstances has been referred to many times as "the golden age of the refiners". I guess if you take the long view refining has always been a very cyclical industry with the roots of the current upswing beginning around the mid-eighties. That was approximately the time that american drivers began to feel comfortable trading fuel efficiency back in for creature comfort, performance in their vehicles. The consumer always has the last word in that driving habits are easily changed. I could cut my costs back to almost nil if I had to, however, I would much prefer a smooth market wher eI didn't have to make drastic lifestyle changes. Beleive me, it's not unreasonable to see the price of gas go to 3.50 + in the next couple of years if a couple more refineries get shut down. At that price for me, the moho's gone, the boat's gone. It just wouldn't be worth it.

There is a problem here and one that the refiners will not correct out of the goodness of their hearts. It needs to be regulated on the consumer side to offset the effects of being regulated on the supply side, or the consumer is just getting "pumped".

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Post by sbheg »

L&L Corvairs wrote:Harold…..been busy….
me too understand :-) Getting ready for the weekend :-)

I am for a free market and agree in principle just like airkuld.

My problem is with windfall profits, the cost for them to deliver the product is un-proportional to what they are charging, otherwise there profits would have increased per capita at the rate of cost increase. This is not true, so the refiners are controlling an artificially higher price. I have a problem with that; it is not truly competitive in the energy sector.

I personally prefer less regulation, but in the case of energy I do not trust the greed of American businesses in this sector.

I believe that you are entitled to make profits, but the energy sector has not been stifled by financial regulation, but environmental regulation and that needs to be fixed.

See you on the weekend.

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Post by Glamisman »

Being the owner of rent controlled property I can tell you first had that there is no such thing as a "fair return", "regulated profit" or "windfall profits", the owners of any business should get what the market will bear for their particular product or service. The moment you take the profit motive out of anything you will loose the incentive to produce that "thing"... i.e. communism... a little story that you did not learn in public school about the true reason behind Thanksgiving. The Mayflower pilgrims tried a communistic approach to the planting/harvesting/hunting etc. and nearly starved to death the first winter. It appears that not enough of the pilgrims were willing to put in 18hr days to feed all the slackers in the group and if the Indians didn't have pity on the poor starving pilgrims this experiment would have failed the first year. So when the harvest came in they gave "thanksgiving" for having survived/lived/have something to eat for the winter.

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Post by sbheg »

Glamisman wrote:Being the owner of rent controlled property I can tell you first had that there is no such thing as a "fair return", "regulated profit" or "windfall profits", the owners of any business should get what the market will bear for their particular product or service. The moment you take the profit motive out of anything you will loose the incentive to produce that "thing"... i.e. communism... a little story that you did not learn in public school about the true reason behind Thanksgiving. The Mayflower pilgrims tried a communistic approach to the planting/harvesting/hunting etc. and nearly starved to death the first winter. It appears that not enough of the pilgrims were willing to put in 18hr days to feed all the slackers in the group and if the Indians didn't have pity on the poor starving pilgrims this experiment would have failed the first year. So when the harvest came in they gave "thanksgiving" for having survived/lived/have something to eat for the winter.
There are successful stories of communities like the kibbutz, but that is not what this is about, not preaching communism here.

Your problem is simple sell your rent controlled property to some one else and buy non-rent controlled units to rent. There is no pseudo monopoly going on with rental units, it is not controlled by a few companies that provide all the rental units in LA for example.

My point is that a free market does not exist when it comes to electric energy and the petroleum sector is not a true free market given the enormous barrier to market for upstarts and no incentive by providers to reduce their cost of their products given the market in place allows for this type of consumer gauging.

sbheg
Proud ASA Volunteer

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