Solution to gas prices: Nationalization

Right, but before that time, the oil is sitting there for a billion years.
The cost of the oil itself is $0 as long as it sits there. The cost of raw
material is the same in 2007 when we pay $3.30 a gallon for the finish
product as it was in 1962 when we paid 19¢ for hte same gallon. Nothing has
changed in the pool of oil. Sure, some is easier (cheaper) to get to the
refinery than others, but above that cost, what?

The change, over the years, of the selling price is the cost of obtaining,
converting, and delivering the final product. Add some profit and what
should gas really sell for? The $3 we pay, the $6 in much of Europe, or the
25¢ Chavez is charging? Will we conserve at $8 and squander it at $2?

My point is, what should gas really sell for and who should be getting the
money above processing cost. You hear some twit say gas should be $10 a
gallon, other want it for next to nothing.

So, answer the question. What should gas be selling for? You must have an
opinion.

 

IMHO, I agree with what you said earlier. The cost of the entire process
(from ground to pump), plus a little extra for profit is enough.

 

We're really having a disconnect here.

What about, say bread. The raw materials are in the ground sitting
there. They're free. Add some seed, then a miracle occurs and you get
wheat. Then another miracle occurs and you have bread. So - $0.10 a
loaf ought to be about right.

What about a professional service - say a bridge design. The consulting
engineer's out of pocket is maybe $100 for paper and ink. So how does
he get to charge tens of thousands of dollars for something that, by
your philosophy, only cost him $100?

What do you do for a living? Let's put your value added work to the
same test as you want to put to the oil companies.

Like I've said, I'm not a fan of the oil companies, but let's be fair.

The engineer pays $100 for paper and ink that used to cost $25. Why
isn't he only charging a couple hundred dollars for his services? Plug
in any endeavor you want to - including whatever it is you do for a
living. Your argument is ludicrous.

By the same general rules as any other for-profit endeavor. Again -
let's put your job to the same analysis. I don't think we want to start
telling each other what we have the right to charge. The market decides
that.

I have no idea - I don't know enough about the business. I would not
even venture a guess. I do know that if a competing viable form of
energy were to be found, the price - by free market rules - will come down.

Fact is, they are making around 10% profit. Back to my original
question - what's wrong with that?

Bill Putney
(To reply by e-mail, replace the last letter of the alphabet in my
address with the letter 'x')

 

My philosphy? I did not state what anything should sell for, but opened a
discourse for everyone to contribute. You seem to think I'm saying it
shoudl be cheap. I'm not against profit at all. I own stock in oil
companies so I do want them to make a healthy profit.

Yes, let's be fair. They should make a profit. There are people that have
stated that gas should be selling for $10 or more a gallon. What I'm asking
is it they want to make a case for that, whee should that money go? The oil
companies? The land holders? The goverment? There are others that think
gas should sell for pennies. Maybe it should. The cost of raw material has
not changed for a billlion years, only the cost of retrieving and processing
it. Unlike you loaf of break, oils is just sitting in the ground whereas a
farmer must plant and grow wheat at some expense.

What argument? I'm not arguing anything, I'm asking a question that you
don't have the asnwer for. I'm not stating what I think gas should sell for
at all. What I do for a living is ofer my services and knowledge. I get
what I can for it. Gas is a product and the raw material itself, the crude
oil, is there for the taking.

Hey, now you are catching on to the discussion here. I'm not suggesting
anything. I'm soliciting opinions. Some have been brought forward over the
past six months or so.. Some thing gas should be selloing for less, others
for more. I'm just wondinering how they arrived at their conclusions.
Especially from the poster here that said gas is not selling for its "true
value". I'm asking what that "true value" is and how it was arrived at.
Somehow you seem to have missed that part early on.

Nothing. As I said. I'm a shareholder. 15% would be better. Why do you
think I'm against charging what it cost and a good profit? Rather than
discuss a statement made by a poster here, you've become confrontational, or
at least defensive when I never took a position either way. It still goes
back to the OP and his "true value" of oil.

 

2006 Oil Profits 119 billion
2006 Election Cycle:
Federal Campaigns: 18.9 million
Federal Lobbying: 123.8 million
State of California Campaigns: 91.6 million

March 06:
Last month, the Bush administration confirmed that it expected the
government to waive about $7 billion in royalties over the next five
years, even though the industry incentive was expressly conceived of for
times when energy prices were low.

"The big lie about this whole program is that it doesn't cost
anything,'' said Representative Edward J. Markey, a Massachusetts
Democrat who tried to block its expansion last July. ''Taxpayers are
being asked to provide huge subsidies to oil companies to produce oil,
it's like subsidizing a fish to swim.''

But on Aug. 8, Mr. Bush signed a sweeping energy bill that contained
$2.6 billion in new tax breaks for oil and gas drillers and a modest
expansion of the 10-year-old ''royalty relief'' program. [end quotes]

It will be interesting to see how and by whom *this* current bill is killed:

http://www.usatoday.com/news/washington/2007-01-18-house-oil_x.htm

 

I don't see the difference. There are costs in doing both (there are
costs in getting the oil out of the ground just as there are up-front
expenses that the farmer incurs before he has access to the processable
raw material). The costs are different than each other, but
nevertheless they are costs. What difference does it make at what point
in the process the expense occurs. Again - I'm really missing the point
there.

And there is expense in the taking just as the farmer has expense before
he has access to his raw material. Again - what is your point there?

Sorry - I'd have to look back at what it was I was initially taking
issue with. I'm just having trouble getting the point of some of your
statements about the oil just sitting there for the taking, as if there
are no costs involved there in contrast to the farmer who has up front
expenses before he can harvest his wheat.

Bill Putney
(To reply by e-mail, replace the last letter of the alphabet in my
address with the letter 'x')

 

To quote a great President, "There you again." Just thorw the raw
dollar numbers out and ignore the fact that it is a respectable 10%
profit. That's the dishonesty I was referring to earlier.

Bill Putney
(To reply by e-mail, replace the last letter of the alphabet in my
address with the letter 'x')

 

LOL, now we're in the land of subjective.

Again, subjective but at least understandable.

 

[/QUOTE]

Not nationalization which will only create an unresponsive Gov.
bureaucracy.

I suggest the oil company excess profits go into a Gov. controlled
carbon offset fund. Not a totally private carbon offset fund because
the con artists like Gore will get their hands into it.

 

Not nationalization which will only create an unresponsive Gov.
bureaucracy.

I suggest the oil company excess profits go into a Gov. controlled
carbon offset fund. Not a totally private carbon offset fund because
the con artists like Gore will get their hands into it.[/QUOTE]

LOL, we wouldn't want any "con artists" involved in the oil business,
that's for sure.

 

Yes, you missed the point so no sense trying to have an intelligent
discussion about it.

 

Umm - OK - maybe someone much smarter than I will explain the point of
your statement: "The cost of raw material has not changed for a billlion
[sic] years, only the cost of retrieving and processing it. Unlike you
[sic] loaf of break [sic], oils [sic] is just sitting in the ground
whereas a farmer must plant and grow wheat at some expense."

You *appear* to be saying that there is something unique about the cost
of getting oil out of the ground that makes it insignificant and/or
impervious to inflation, while the farmer's cost of planting and
harvesting wheat are more real and are more subject to inflation.

If that was not your point (which, if it is, is void of all logic),
maybe someone besides you (to illustrate that your point was obvious to
anyone, besides yourself of course, with more than an ounce of
intelligence) will explain (1) exactly what the point of your statement
was, and (2) how much perfect sense your statement makes in explaining
why the dollars spent by a farmer taking the steps necessary to be able
sell or harvest his wheat are different in nature than the dollars it
takes to get the oil out of the ground, and why both cannot equally be
considered costs of getting the raw material to the next step, which is
processing of said raw material to turn it into a useful/sellable product.

Anybody?

Bill Putney
(To reply by e-mail, replace the last letter of the alphabet in my
address with the letter 'x')

 

OK - I'm seeing one point that I may have momentarily missed, but even
with that accounted for, it doesn't make your point any more valid. I
guess what you're saying is that the farmer's up front costs of planting
have no counterpart in "creating" the oil. IF that is your point, it is
moot. There are costs for "manufacturers" of both bread and oil - all
subject to inflation - involved in getting it into a sellable form.
The fact that the relative size of those costs at the different
sub-stages prior to the point of consumer end-user purchase does not
change the fact that there is a total bottom-line inflation-sensitive
cost for getting both products to market.

Bill Putney
(To reply by e-mail, replace the last letter of the alphabet in my
address with the letter 'x')

 

The cost of oil is the same. The cost of getting it has changed. You
brought wheat into the conversation. We're taling oil prices here.

Never was the point. You long ago missed the point.

Why do yo keep bringing wheat into a discussion about the "true value" of
oil. Go pack to the post before mine, where a poster said oil was not
selling for its "true value" Keep the wheat and bread in the supermarket.
Guess your argument is a "straw man"

 

Bill., the point of the original question was long ago lost. It has nothing
to do with wheat, oranges, apples or how much profit a supermarket makes on
watermelon. I never denied they have costs, were subject to inflation, or
that oil companies should make a profit. There was a question about oil
being sold for its "true value" and I questioned what that was. I'm sure
most everyone has long ago lost interest in the subject. You missed the
subject. There is no point in trying to go back to refine anyone's point
about anything. Good luck with the farm and I hope your crop does well this
year and you sell it for a large profit. Your farm subsidy check went to
David Letterman anyway.

 

LOL. But......., did any country ever invade a sovereign nation to
*help* them harvest their wheat and fix it so they "helped" (for a
reasonable price) for the next few decades? Can wheat really inspire
that sort of altruism?

http://www.cbc.ca/onthemap/fullpage.php?id=49

 

Moonbat alert.

Bill Putney
(To reply by e-mail, replace the last letter of the alphabet in my
address with the letter 'x')

 

You have me confused with someone else.

Bill Putney
(To reply by e-mail, replace the last letter of the alphabet in my
address with the letter 'x')

 

That was quite an expose on the CBC. Only an ultra-liberal would be so
dishonest as to not be able to distinguish between a wall built by a
communist country for the purpose of keeping its citizens from escaping
to freedom from a wall built by another country to prevent illegal
aliens from, among other things, stealing services that they never paid
for in lieu of going thru a legal process to become citizens. Truly
amazing and disgusting.

Bill Putney
(To reply by e-mail, replace the last letter of the alphabet in my
address with the letter 'x')