Does anyone here actually think it's good that oil companies have to defend profit?

[Spideynw]

Originally Posted by Smull

I suppose I'll agree to disagree with you, on that. Your solution is more idealistic, mine is more feasible.

My solution is "idealistic", but so what? Yours is more probable, but that does not make it better.

Of course there are more costs than simple dollars and cents, to take an admittedly extreme example: Assassinating the President wouldn't have much of an economic impact on our country but we feel he's still worth protecting.

The cost is how much it costs taxpayers to pay for the protection. So I am sorry, but you are wrong. There is a cost, and it is simple dollars and cents.

Perhaps I'm simply not articulating my case well, heres Thomas Friedman, a man much smarter than myself, on the same issue.


Feel free to do that math and figure out what the exact economic costs could be in that scenario.

Way to shift the burden of proof.

you got me, I just love the garbage

Well, you are the one that made the claim that it would be better, without providing any evidence.

If global oil prices were driven up you think ours would remain where they are? This strikes me as a naive statement from someone who has based his entire argument on economics.

I never made this claim. Try re-reading.

Look, I enjoy discussing these sorts of things, its why i joined these boards, but I don't feel this discussion is going anywhere, and its becoming more and more bitter. I think our most basic disagreement stems from what i said at the top of this post, which is that you pursue more or less a complete overhaul of how our government functions and while in theory this may work, the changes it requires (I feel) simply aren't feasible right now. It would take at BEST a generation to accomplish these goals. I (try to) pursue the policy which has the best chance of doing this country good, but are also politically feasible, I like to think of myself as a realist. If you think there are further points to be made or things to be said, then I'll continue this discussion, but I feel we may have to simply agree to disagree.

It has been my experience that most people that do not have valid arguments simply give up.

[Spideynw]

Originally Posted by WickedLou9

We are totally dependant on them. If you can't figure out a way to cut our oil consumption by 20% right now, then our dependancy is hard to get around. Even a small interuption in supply could have disasterous consequences.

And they would cut their supplies why again?

[Smull]

Originally Posted by Spideynw

The cost is how much it costs taxpayers to pay for the protection. So I am sorry, but you are wrong. There is a cost, and it is simple dollars and cents.

If you feel that the value our head of state's life is exactly akin to the financial costs of the secret service then our dissagreement goes far deeper than simple economic ideology.

Originally Posted by Spideynw

I never made this claim. Try re-reading.

You claimed that :

Originally Posted by Spideynw

Lastly, the U.S. is hardly dependant on OPEC. We provide 40% of our own oil, and get another 40% from Mexico, Canada, and Nigeria, all non-OPEC countries.

Which led me to believe that so long as we get 80% of our oil from our friendly neighbors, we won't need to worry about what the rest of the global oil market does. This isn't the case. I hope you don't need a cost benefit analysis to understand why.

Originally Posted by Spideynw

And they would cut their supplies why again?

"again" is exactly right. How does that old cliche go? "Those that do not learn from history are doomed to repeat it"?
1973 oil crisis - Wikipedia, the free encyclopedia
1979 energy crisis - Wikipedia, the free encyclopedia
*The first oil crisis was because we supported Israel, which pissed off a lot of Arabs. Needless to say we are still pissing off a lot of Arabs today.
*The second oil crisis was because the Iranian government collapsed/was overthrown (something our government is now ENCOURAGING and SPONSORING) and was worsened by the Iran Iraq war.

Lets look at the effect those had on our economy

The effects of the embargo were immediate. OPEC forced the oil companies to increase payments drastically. The price of oil quadrupled by 1974 to nearly US$12 per barrel (75 US$/m³).[6]

The price of energy continued increasing in the following year, amid the weakening competitive position of the dollar in world markets.

The Cold War policies of the Nixon administration also suffered a major blow in the aftermath of the oil embargo. They had focused on and the Soviet Union, but the latent challenge to U.S. hegemony coming from the Third World became evident. U.S. power was under attack even in Latin America.

As the average vehicle of the time consumed between 2-3 liters (about 0.5-0.8 gallons) of gasoline (petrol) an hour while idling, it was estimated that Americans wasted up to 150,000 barrels (24,000 m³) of oil per day idling their engines in the lines at gas stations.[8]

I concede that I don't know the exact economic impact that another oil crisis will have on our (let alone the global) economy, I doubt anyone does as oil markets are notoriously hard to predict and control, as are the middle eastern dictators who control most of that oil. If you claim that because this number cannot be precisely determined that the government has no role in preventing such a crisis, then you are advocating and incredibly short sighted policy that may AGAIN drive our economy down, as it did TWICE in the 1970s. There is no way to prove that this WILL or WILL NOT happen, but given how volatile the Middle East is, and how popular we are over there, its taking a big gamble to ignore our DEPENDENCY on their oil.

[Spideynw]

Originally Posted by Smull

If you feel that the value our head of state's life is exactly akin to the financial costs of the secret service then our dissagreement goes far deeper than simple economic ideology.

Presidents are easily replaced. Not only that, but presidents that don't kill others, tax too much, or trample on the rights of others have nothing to really fear. But it appears you think there is no price we can put on life. I live in the real world though, and there are limited resources.

"again" is exactly right. How does that old cliche go? "Those that do not learn from history are doomed to repeat it"?
1973 oil crisis - Wikipedia, the free encyclopedia

Voluntary and Coercive Cartels: The Case of Oil| The Foundation for Economic Education: The Freeman, Ideas on Liberty

...It is the “price shock” of 1973 that is commonly seen as the beginning of OPEC’s control over prices. In October of that year OPEC announced an embargo on oil to the United States because of U.S. support for Israel in the 1973 Arab-Israeli War. OPEC also announced a cutback in production and a price rise to $5.12 a barrel. In December the price was increased to $11.65 a barrel, a quadrupling of prices in just a few months. Doesn’t this indicate market control by a voluntary cartel?

There are several factors which need to be considered to understand why this is not the case. First, there is substantial evidence that by 1970 the oil “glut” was gone and the world, in fact, was facing an oil “shortage.” Demand for oil had increased 7 per cent a year from 1950-73. In 1940, for example, coal accounted for two-thirds of the world’s energy. In 1965 coal and oil each accounted for 37 per cent of total energy consumption. By 1980, oil’s share of world energy consumption stood at over 40 per cent; coal’s had fallen to 30 per cent.

On the other hand, due in part to the artificial stimulus of the controls on foreign oil, U.S. reserves were quickly being depleted. This problem was compounded by the fact that as new sources of domestic oil became increasingly difficult to find and extraction costs rose, U.S. production peaked and by the early 1970s was actually declining.[20]

The result of these trends was an extremely “tight” market. This is shown by the fact that prices began to rise even before the 1973 embargo. In February 1971, for example, oil prices rose 50 cents a barrel. And by early 1973, months before the October embargo, prices on the spot market—a free market for small quantities of “excess” oil—were up to $20 a barrel, or over five times the official or “posted” OPEC price at the time.

Second, an analysis of oil industry profits shows that with rising production costs associated with offshore and deep drilling, the high returns of the I950s were gone. During the 1960s profit rates fell below those in the far less risky manufacturing sectors, and by the early 1970s they stood at an all-time low.[21] Since incentives and exploration are closely related, it is clear that domestic production could not be maintained much longer at their current levels in the absence of significant price increases. In fact, U.S. production was already declining.

The final factor is the 1973 Arab oil “embargo.” An embargo is an attempt to punish a country or region by imposing an abrupt halt in the flow of a particular good, in this case oil, to the embargoed country. When the embargo is imposed, prices in the embargoed country should rise while production in the embargoing countries should be curtailed. And when the embargo is lifted, production in the embargoing nations should increase, causing prices in the embargoed countries to return to “normal.” The problem is that the 1973 “embargo” didn’t work this way. First of all, although prices did quadruple, the embargo was never very effective. It was marked by massive “cheating” and defections among cartel members. Moreover, OPEC production declined less than 15 per cent in 1974-75, and its exports to the “embargoed” U.S. increased dramatically between 1973 and 1977. And finally, rather than declining at the termination of the embargo, oil prices actually increased slightly.

All these factors indicate that, as Paul MacAvoy put it, OPEC “never really controlled the world crude oil market. Rather, market forces were the dominant factor all along.”[22] The pre-1973 prices were far too low to be maintained much longer...

I will have to respond to the rest of your post later.

Regardless, I suggest you study up on Austrian economics at either mises.org or fee.org. But if you are not interested in learning, there is nothing I can do about that.