The bill's main sponsor, Rep. Bart Stupak, Democratic chairman of the House Energy and Commerce Committee's Subcommittee on Oversight and Investigations, said excessive speculation was "killing our economy."
Speculation usually accounts for only $8 to $9 per barrel to the cost of crude, but in current markets, he said, speculation is adding about $65 to $70 a barrel -- almost half the price of oil.
"We don't mind people making money," Stupak said. "We're not saying end speculation. We're saying end the excessive speculation that continues to put a higher and higher floor (on oil prices)."
Democratic Rep. Jay Inslee said the law of supply and demand, which some have cited as causing the rise in oil prices, are not at work here.
Whew! Just in time. Are you as relieved as I am? Now everything will be just fine. Oil prices will be cut in half in no time; gasoline prices will plummet; and We The People shall rejoice. Our saviors on Capitol Hill have rescued us once again from impending doom. Such is the genius of our elective representatives, you see, that they are able to know the precise price level when speculation becomes 'excessive.' Such is their ability to judge market forces that they know to a certainty the amount speculation usually accounts for in the price of a barrel of oil; normally $8-9 dollars, now $65-70. Who knew! Furthermore, their skills at fine-tuning the economy are so acute they know the exact modifications to be made to crude markets so that speculation is still allowed but none that is 'excessive.' Well, why would anyone be surprised? These are the very folks, after all, who know the exact level whereby a profit becomes, not just a profit, but a 'windfall' profit. Finally, regarding the quote from the estimable Mr. Inslee, apparently the laws of supply and demand have been repealed. I had missed that.
My cynicism, when it comes to these clowns, clearly knows no bounds.
However, their is no need for the rest of us to remain as ignorant on these issues as the ladies and gents on Capitol Hill. To learn more about speculation, why the term should not be used as a pejorative, and why it is critical to the smooth and efficient operation of markets, take five minutes to read this excellent article by Rick Newman that originally appeared in U.S. News and World Report. You will then almost surely have spent more time attempting to understand speculation than the man or woman who represents you in Congress.
No comments:
Post a Comment