Plan to drive more this summer? Annoyed by the price of gas? Complaining that oil companies rip you off?
I say, shut up. Even if gas costs $4 per gallon, we should thank Big Oil.
Consider what they have to do to bring us gas.
Oil must be sucked out of the ground, sometimes from war zones or deep beneath oceans, pumped through billion-dollar pipelines and often shipped across the ocean in monstrously expensive tankers.
Then it's refined into gasoline, transported in trucks that cost hundreds of thousands of dollars. Finally, your local gas station must spend a fortune on safety devices.
And it still costs less per ounce than bottled water.
Another myth: Big Oil makes “excess” profit. Nonsense. The oil business is fiercely competitive. If one company charges a penny too much, other companies steal its business.
Apple's profit margin is about 24 percent. McDonald's makes 20 percent. Oil companies make half that.
The magic of fuel economy standards is another myth.
Susan Dudley, who runs the Regulatory Studies Center at George Washington University, says many car buyers care more about safety, style, power, etc., than mileage.
Car dealers say fuel economy standards will make cars cost $3,000 more.
And James Taylor, a Heartland Institute energy expert, points out that they kill.
“In order to make cars more fuel-efficient, auto manufacturers make them smaller — using lighter materials, they're less crash-worthy. ... We're seeing thousands of people dying on the roads that shouldn't be.”
So, why, when President Obama unveiled the regulations, did the heads of 13 car companies shake his hand and smile?
“Even if it is a $60 billion cost to them,” says Dudley, “if everyone has to do it, they can pass it on to consumers.”
In other words, there's no need to worry about jacking up your prices when your rivals must do so, too. Regulation makes companies lazier, not more efficient.
Republicans at least talk about deregulation. But “regulation-killing Republicans” is another myth. George W. Bush hired 90,000 new regulators.
Almost no one seems to speak up for a true free market in energy. People say regulation is needed to counter industry “greed.”
But if anyone's greedy here, it's government — and unlike oil companies, government doesn't have to work hard and compete.
Government just sits there, telling companies to charge less, telling car companies to make smaller and more dangerous cars, mandating and subsidizing alternative fuels like ethanol — and then telling us that we benefit from politicians' efforts.
The truth: We rarely benefit.
John Stossel is host of “Stossel” on the Fox Business Network. He's the author of “No They Can't: Why Government Fails, but Individuals Succeed.”
