Offering frequent news and analysis from the majestic Evergreen State and beyond, The Cascadia Advocate is the Northwest Progressive Institute's unconventional perspective on world, national, and local politics.

Tuesday, May 02, 2006

If they fix it for you, Rush, you'll never whore again.

Republicans might be forgiven for thinking they could buy off outrage on gas prices with $100 checks. After all, it was a miserably modest tax break for middle income earners that brought them the budget-breaking giveaways to the rich. Dollar-for-dollar, the poison we swallowed with that bit of sugar is going to be much more deadly than this would have been.

But it looks like the public is going to fill the sponsors of this idea with arrows before they can get back in the fort. The sad part is that there appears to be no change in the debate. The gas-o-holics continue to blab about ANWR drilling, and the good guys focus on oil company profiteering.

Which is not to say that oil companies are not enjoying their ride, nor that they are innocent in market manipulation, nor that they shouldn't be slammed with excess profits taxes or even regulated like utilities. The corporatists ...
(I use this word, even though it sounds weird, because the alternative is "fascist," as in Mussolini fascism, which is a corporate takeover of the state. I heard recently "friendly fascists." That seemed like more of an amusing oxymoron or a sugar coating. If anybody gets a better term for this calamity, please let me know.)
... The corporatists mesh state and corporation most completely on the energy issue. Enron writes the energy plan. Oil companies decide what the solution is to gas prices. The sitting president and vice president will be back on the boards of energy firms as soon as they leave office.

Naturally the $100 vote-for-me bribe on the part of Republicans has no significance economically. Equally absurd is Rush Limbaugh's plaint, "What kind of insult is this? Instead of buying us off and treating us like we're a bunch of whores, just solve the problem."

You might not be a whore, Rush, but you're an idiot. This is the party that brought you Iraq, Medicare Part ? drug benefits, FEMA and Hurricane Katrina, energy deregulation, the federal budget. If they fix it, stand back.

Let's not learn the wrong lessons here, though. Gas prices are not too high. The profits of oil companies are too high by a factor of ten or so. The spending by individuals and the society is twice too high. But this is because are far too dependent on gasoline than a sane group of people ought to be. We continue to squeeze more lanes of concrete at ever higher costs into our cities, roads which will wear out quickly under the weight of increasing freight. We have, absurdly enough, no meaningful, coordinated plan to move to the next stage.

But the per-gallon price is not too high. Why?
First, we can see clearly now that $3 gas is doing more to produce fuel-efficient cars than any number of CAFÉ standards. It is time to abandon the CAFÉ struggle. It took too much effort and it didn't work. Let's go to green taxes, like on carbon, or just oil and gasoline. Regulations are too easy to wiggle through. Witness the Hummer as a tax-benefitted farm machine.

Second, the price of gas does not cover the real costs of producing and consuming it, as it should if the market is going to be efficient. Geopolitics is obsessed with oil. Wars are not cheap. But even greater (imagine it) is the environmental calamity we are bringing down upon our heads. Neither of these is represented at the gas pump. The market discounts both completely, and so subsidizes our own destruction.

Third, a higher price makes alternatives financially feasible. Let me add quickly that the price must also be stable for alternatives to be developed through the private market. The wildly fluctuating prices of the past three decades have discouraged innovation, where a stable price, even at the average, would have produced market alternatives. Broad-based energy planning and production is absolutely vital to the survival of our society. A key part of "broad-based" must be alternative energy developed as a response to market incentives. "Market incentives" here means "price."
The natural resolution to this situation is to capture a great part of the difference between a high price and the actual cost of delivering gasoline to the pump, and use it for the purposes of developing alternative energy. Currently this difference is being captured solely for the purposes of expanding the profits of oil companies.

Rebates to gas consumers? No. Better to pay people for not consuming.

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