07-28-2006, 02:19 PM
Arguing about profits and market power misses the real problems:
1) Oil CONSUMPTION is subsidized implicitly through subsidies on roads, farming, industry, automobiles, trucking, housing incentives that move people to longer commutes, lack of leadership, and by failure of the state to capture (and redistribute) the full cost of negative externalities etc. etc.
This has created a nation that is dependent on Automobiles and therefore Oil.
2) Oil PRODUCITON is subsidized through both blatant giveaways i.e. cheap/free land/ocean leases, exploration funding, and implicitly with trade protections/distortions, lack of leadership, and by failure of the state to capture (and redistribute) the full cost of negative externalities. etc etc
You might have noticed some commonalities?
The production and consumption of oil creates negative externalities including but not limited to; air polution, noise pollution, water pollution, light pollution, unsightlyness, increased run-off, heat pollution...... As individuals it is impossible for us to collect compensation from each of the consumers and producers. Therefore, those that produce and/or consume the most end up relatively better off than those who consume the least because they get to enjoy all of the benefits while only suffering a portion of the total costs---pollution or otherwise.
Moreover, those who produce/consume the most also tend to be those that can afford to avoid many of the externalities that they disproportionally create by living in nicer, cleaner, quieter, safer, less polluted areas.
It is just another form of expanding inequality that is self reinforcing.
Forget windfall taxes, forced renewables investment and such---remedy the implicit subsidies and create/enforce some meaningful laws to curb the externalities and you will see a dramatic shift in what technologies are invested in.
1) Oil CONSUMPTION is subsidized implicitly through subsidies on roads, farming, industry, automobiles, trucking, housing incentives that move people to longer commutes, lack of leadership, and by failure of the state to capture (and redistribute) the full cost of negative externalities etc. etc.
This has created a nation that is dependent on Automobiles and therefore Oil.
2) Oil PRODUCITON is subsidized through both blatant giveaways i.e. cheap/free land/ocean leases, exploration funding, and implicitly with trade protections/distortions, lack of leadership, and by failure of the state to capture (and redistribute) the full cost of negative externalities. etc etc
You might have noticed some commonalities?
The production and consumption of oil creates negative externalities including but not limited to; air polution, noise pollution, water pollution, light pollution, unsightlyness, increased run-off, heat pollution...... As individuals it is impossible for us to collect compensation from each of the consumers and producers. Therefore, those that produce and/or consume the most end up relatively better off than those who consume the least because they get to enjoy all of the benefits while only suffering a portion of the total costs---pollution or otherwise.
Moreover, those who produce/consume the most also tend to be those that can afford to avoid many of the externalities that they disproportionally create by living in nicer, cleaner, quieter, safer, less polluted areas.
It is just another form of expanding inequality that is self reinforcing.
Forget windfall taxes, forced renewables investment and such---remedy the implicit subsidies and create/enforce some meaningful laws to curb the externalities and you will see a dramatic shift in what technologies are invested in.