It has become completely routine. Gasoline prices rise, Democrats begin screeching about the evil oil companies and their "price-gouging". They demand investigations, screech and wail a while longer, then move along to the next thing they can get headlines with. Meanwhile, the investigations do occur and the results are ignored.
Last summer, Congress again called on the FTC to investigate.
Last month, the agency issued its report. The findings? Last year's spike was caused by . . . market forces.
That mirrors its 2006 report, which similarly found "no evidence of manipulation" in the post-Katrina price jumps.
The problem, instead, was a series of simultaneous events: climbing crude prices, refining capacity that had been reduced by storm damage and increased U.S. demand for gasoline.
That's not to say that only supply and demand are to blame. The reports also finger congressional policies – specifically regarding ethanol.
Last summer, refiners were essentially forced to start using more of the corn-derived additive, nearly doubling its cost per gallon. Demand for ethanol became so intense that refiners began importing almost 20 percent of their supply, despite a 54-cent-a-gallon tariff.
The New York Post has lots of handy quotes by the posturing gasbags in Congress. There's an old adage about pointing fingers at others. When you do so, you point three back at yourself. The terribly short-sighted stampede to use ethanol has real costs – and will cause real damage soon enough. I have linked time and again to expert opinions that say the rush to biofuel is terminally stupid. Not that any of that will make the gasbags change their ways. Or stop pointing fingers.
Gaius, I am getting pretty doggone tired of you badmouthing ethanol. Let’s disregard the high food price effects and review the merits of ethanol. 1) Unless you believe in perpetual motion, it takes more energy to produce ethanol than what is produced. 2)Air quality improvement is negligible or nonexistent. 3)Burning ethanol in a vehicle causes mileage to drop because their are fewer BTUs in a gallon of alcohol compared to gasoline. 4) Widespread anecdotal evidence suggests that alcohol is very hard on engine parts because it dries out the fuel so much. 5)Ethanol is subsidized by the taxpayer every step of the way, from production at the farm, at the processing plant, and finally at the pump, where road taxes are waived to make price competative. With all that going for ethanol, how can you possibly against it? Ethanol will save us all.
Gee, you make a really strong case.
Sigh….Gaius your badmouthing of ethanol is getting old. High food prices aside, let’s review the merits of ethanol: 1)Ethanol is subsidized at every step, at the farm, at the processing plant and at the pump by waiving road taxes. 2) Unless you believe in perpetual motion, you can’t get pour energy into ethanol production and expect to get more back. This is like using a battery to power a generator to recharge the battery. 3) As there are less BTUs in a gallon of alcohol compared to a gallon of gas, mileage will go down. 4)Air quality improvement from burning ethanol is negligible to non-existent. 5) Widespread anecdotal evidence suggests that Ethanol is hard on engine parts and ethanol will cause some motors to vapor lock in hot weather. So now maybe you will see the light. Ethanol will save us all.