As I’ve said on numerous occasions, one of the most horrible parts of this society is its open display of a five-letter word called greed. It is on display everywhere you look, and it affects everyone. The ones who perpetuate this inglorious behavior seem to want more while those who suffer greed’s clutches want to do away with it.
Case in point is the current rise of gasoline prices. There is no end to the number of stories on the net and other media outlets covering the ever rising and inflated price of gasoline. The South Florida Business Journal writes about how, since May 1, gas prices have risen in Florida by twenty-five cents since the 1st of May. I don’t care what anyone says, that is just plain ridiculous.
The price of crude oil dropped 4% last week, so we should see prices going down instead of climbing, but that is not the case. If gas is going to go up, at least the oil companies and analysts should come up with better excuses than the ones they trot out to the public: summer grade, economic recovery is driving the price up or supply and demand.
We’ve got plenty of oil in this country, enough to last many, many years. The Democratic party has fought for years against building new refineries and digging in areas where oil is plentiful. When will the American people wake up and fire those who oppose cheaper oil and gasoline prices? Can you imagine the audacity of some in the government who wish to add even more taxes to the already overpriced cost of a gallon of gas?
In my humble opinion, gas should not be more than $1.00 – $1.50 per gallon. That’s plenty. Gasoline prices rise because those who control it are greedy and have little or no regard for consumers. Greed is a blight on this country and has ruined the lives of many people. Some people can’t seem to be satisfied with what they’ve got and have to constantly push for more. Their appetites simply cannot be controlled.
Two scriptures come to mind, and I would like to share them with you:
Proverbs 1:19 (ESV)
Such are the ways of everyone who is greedy for unjust gain;
it takes away the life of its possessors.
Proverbs 15:27 (ESV)
Whoever is greedy for unjust gain troubles his own household,
but he who hates bribes will live.
From Preacherpen's Desk 
This is a good article. To tell you the truth, I did not fully understand what Paul was saying when he said “the love of money is the root of all kinds of evil”. I have seen this in mainstream church as well as the world. God is going to bring us down to ground level if we’re not careful.
Yes, greed is everywhere, and we must stand guard over our own hearts so we don’t succumb to its tantalizing calls.
Point of fact, the gas prices always go up as the summer driving season gets closer. They see the chance to make more profit and they take it. By the same token, gas prices do drop somewhat in the winter, but the price of heating oil, which is used a great deal in the northern part of the country, always goes up in the winter. The oil companies use any excuse they can find to raise the price of one or the other of those commodities. Sad but true.
Larry, I agree wholeheartedly. As I mentioned, it’s the greed which causes this to happen, though. Yes, gas prices do drop a little around here, too, during the winter months. I can’t remember about the prices where you live, but here, they shoot up a dime or fifteen cents at a time.
The main point of the post was to point out the nature of greed and how it has affected the oil industry. With the amount of gas sold each day, why not make just a little on each gallon instead of gouging the American public? That’s my point.
Being a simple engineer, I like numbers, with the hope that, properly organized, they can help you see various trends. Here is a link to an online spreadsheet and graph of gas prices for one gas station just down the street, compiled over the last year. I drive by the place every day, and thought it might be useful to record what was happening as gas headed to $4.20/gallon here last summer – and then back down. After bottoming out at $1.55 or so, prices crept up to $2.06 over time and stayed there for quite a while. And then, boom, up to $2.36 in the course of the last two weeks.
Here is a link to the graph: http://tinyurl.com/4ddco3
What you call “greed” the oil companies may call “maximizing shareholder return”. The way publicly traded corporations are organized, serving the public, or providing products, or anything else related to what they actually do as a business is not the first priority; maximizing shareholder value is. This is so much the case that publicly traded companies put themselves at risk of shareholder lawsuits if their actions (or even their inaction) can be interpreted as not yielding maximum returns to their investors.
One result of this need to maximize return may be the decision to not explore as aggressively as possible. The NYT reported a while back that one major oil company seemed to have the strategy of basically pumping what they had, avoiding big investments, and even preparing to liquidate a decade or so in the future to return maximum wealth to investors, rather than divert the money to new exploration or other investment.
The lack of new refineries probably follows this argument. The Democrats may have pushed for environmental controls, which may be seen as economic impediments, but recall that it was President Nixon who established the EPA in 1970, and insisted that they view “the environment as a whole.” (http://www.epa.gov/history/topics/epa/15c.htm). I think the reality is, refineries are very expensive, and the cratering of the oil market in the 80s made oil companies very reluctant to invest in capacity they couldn’t use fully. There is nothing more profitable than running a thoroughly amortized facility at 100% capacity – the cost of operation is then just incremental cost, not the capital cost of amortization of new facilities. Having Democrats/liberals/the EPA/anyone else around to give political cover as to why there is little slack in the system is a PR bonus.
Another factor for local price rises is that local gas stations buy their gas on long term contracts from wholesalers. They have to predict the future price months in advance. In a year that has seen a price shift of over 2:1 in just a few months, that kind of prediction can be hard to do.
Finally a few words on drilling. Peak oil does seem to be real. This does not mean that we run out of oil tomorrow. It means that we will pay more and more for it, probably relying on politically unstable regions for the light sweet crude that is easy to refine. We have plenty of oil equivalents here – and in Canada – but it is in the form of oil shale and tar sands which would require turning large sections of the American mountain West and some Canadian provinces into huge strip mining operations. The Canadians already get 14% of their fuel oil this way. It’s a political decision if we want to go that way as well. Recall, that was what the Synfuel Corp, established by President Carter was going to do – produce oil from shale in Colorado. The process needed oil to be $40 per barrel to make economic sense. When the oil shock of 1979 was replaced by the oil glut of the 80s, the short term need went away, and President Carter was ridiculed for wasting $100M. Seems likes peanuts today.
Besides oil shale, the US also has a lot of natural gas. The main problem here is that some of the richest pockets of the stuff are in really inaccessible places, so-called “stranded gas”. It is worth noting that the industry lobby group pushing for drilling in the Arctic wildlife refuge quietly disbanded, turning their attention to the far more lucrative possibilities of natural gas. Let me put it to you this way. Warren Buffett was reported to have invested in various forms of natural gas, and Warren Buffett did not get to be among the world’s richest men by making non-optimal choices. Maybe natural gas recovery will need on-site liquefaction plants, maybe new pipelines, I don’t know. What does seem clear is that we can buy 50 or more years of transitional clean energy by properly exploiting natural gas, while we (hopefully) invest in ways to achieve sustainable energy self-sufficiency here at home. Note that is the plan of T. Boone Pickens, an oil man who knows his business and who has never been accused of being a liberal.
So, no doubt good old-fashioned greed has a part in the recent spike in gas prices, but there are a lot of objective factors that make that greed subject to rational decision making. If you want to change the greed, you need to change the business fundamentals that drive it. We can start by not calling each other names (right-wing nut, left-wing loony, etc), and then just get down to doing the hard work of analyzing and fixing the big problems ahead.
Regards,
SBS
Thank you, Steven, for a well-thought addition to my post. You lay out some sound reasons for prices being what they are, but I don’t necessarily agree with all of them. I believe at the root of the problem is that five-letter word called greed, and it is wielded by more people than just those who are movers and shakers in the oil industry.
You mentioned shareholders who want to maximize their investments, which is reasonable to a point. May we not label them as greedy, too, who want to make great gains at other people’s pain? Just a thought.
Have you read reports of oil tankers waiting in waters to deliver their goods until price for their cargo was raised to a certain level? I don’t have my hands on those reports at the moment, but they are available if you care to do some searching.
One more thing: I don’t care what the president and others have said, and continue to say, adding exorbitant taxes on already overpriced gasoline is not good for the country. People struggle to make ends meet now; adding more taxes will just add more burden to people who are already tired of the struggle. The president’s idea is to get us off oil dependence, but taxing us silly isn’t the answer.
I guess one point is, it’s not just the greed of a few CEOs; it’s the greed of their shareholders as well that drives the behavior. The distorting thing about that kind of top to bottom greed is that it is short term – profits this quarter are more important than laying the foundation for sustainable profits later.
Compared to Europe, our gas taxes are very low. On the other hand, as Chief Justice Marshal said in 1819, “The power to tax is the power to destroy”, so we don’t want to double or treble taxes just because our friends across the pond did. It would be nice to have a plan. Is the intention to get us off oil entirely (carbon-free), or just to make ourselves energy self-sufficient (free from reliance on unstable suppliers)? What I hear from both sides is mainly platitudes, not plans.
Finally, yes, “Onemom” is right. It’s not all high level market forces. The tourist season officially opens this week-end here in Maine, so there is more than a little suspicion that the gas prices shot up just to relieve the folks from MA and NY of their money a little quicker. Maybe I should check the price of lobster while I’m at it…
I know I just did a fairly lengthy post, but here is a smaller one which may more directly address your concern as to greed in the spiritual sense and the impact it has on our daily lives. See http://euroracket.blogspot.com/2009/05/its-all-about-usury.html for an argument against usury.
If you want to do something about the bad behavior (greed), one good place to start is to remove the incentive (easy money vs actual work). The article referenced above argues that since 1978 we have had no real protection against usury. Anyone who has seen 20%, 25%, even 30% interest on credit card debt can attest to that. The result of usury-level interest has been to take money out of productive investment and into paper investments. The financial services industry was tiny 30 years ago. Now, it is a major component of our GDP. That is, a major portion of our national wealth is based not on stuff we build, but on interest we charge people to buy that stuff, now outsourced to low-wage venues.
Keeping my over-all theme of not labeling people with politically charged tags in mind, you don’t have to buy into the Catholic Worker Movement, or Catholicism, or distributionism, or any other ism to see that there is a problem with extremely high interest rates in this country. We should take our information where we find it, and make up our own minds as to its validity. It is not necessary to embrace every tenet of belief held by some source of information in order to evaluate and use that information. My view is, urging the people we elect to re-enact limits on interest rates to ensure they are below what a few years ago would have been considered the province of loan sharks is one place to start.
It is useful to identify a problem such as greed. It is even more useful to act on that knowledge, in both personal and public ways, to help solve that problem. As an end result, perhaps we can do well by doing good.
Around here (upper midwest/great lakes), the same general trends you all mentioned are true. However, on Fridays gas prices almost always go up 10 cents and then back down again Sunday night or Monday morning. Same premise as you’ve discussed. Folks around here do a lot of “weekend getaways” to their cottages or camping near the great lakes (or inland lakes), so the stations know more people will be buying gas on Fridays and through the weekends, so they up the price (regardless of what they actually paid for it when it was delivered). I only buy gas on Tuesdays (or several days before a big holiday). Greed is the only word for it.
Kerry, your assessment of the situation seems quite reasonable to me. You said “Greed is the only word for it.”, which is exactly what I believe.
It is perhaps time once again for me to bring out the magic snowglobe
Please bring the snow globe back. I hopped over to your site and read your post about the famous snow globe and left a very late comment. Would you also please ask it to make gas to be about $1.00 a gallon? I’d settle for $1.50 if you could swing it. Thanks.
I’ll see what I can do Ron. The snowglobe hasn’t been needed in a few months, so I’ll have to give it a tune-up. 😉
We need to kill the rising prices before they get more out of hand than they already are.
Your post rings so true. And those who commented have some excellent ideas and insight. However, though I’m not usually pessimistic, I can’t see greedy behaviours changing much, because in the last days “lawlessness will abound and the love of many will wax cold.” But I find comfort in prayer, knowing the Lord hears and answers our cries for justice.
[Btw, airline prices haven’t gone up too much yet–hmmm…maybe they’re competing with the auto/gas industry.]
Thanks again for the timely post. In Him, Linda
Hi, Linda. I’m with you about the greedy behaviors sticking around; it’s a malady which has affected humanity throughout history. Thank you for the scripture reference. Another that comes to mind is one of my favorite in all the Word of God and is found in Luke 18. It is the story about the widow woman who cried out for the judge to help her out of a hard situation.
Don’t give the airline industry any ideas because they might just try a little greed on for size, too!