There's an old saying that it is better to be thought ignorant than to open one's mouth and remove all doubt. This has never been more evident than in the debate over oil companies, gasoline prices, oil profits and windfall profits taxes.
Some in the GOP leadership suggest everything from $100 rebates and windfall profit taxes to Federal Trade Commission investigations and congressional hearings on so-called price-fixing and/or gouging. I'm reminded of Richard Nixon in the early 1970s, when he called for devaluing the dollar, wage and price controls, and higher taxes and tariffs - all of which helped cause his downfall and set the economy on a course of simultaneous inflation and unemployment, the likes of which we hadn't seen in our nation's history.
What is sickening is to hear that the GOP would offer a $100 bribe to poor and low-income people. Can you imagine a political party, ostensibly on the center right, telling people, "Don't earn too much or you won't get a rebate check"? Compare that to Abraham Lincoln, who said, "I don't believe in laws that prevent a man from getting rich. I want every man to get rich. He should be able to earn, save, invest and someday hire others to work for him. That is the American system."
I learned about free enterprise from my dad. He was a truck driver who, after a good year of wages, put a second mortgage on our Los Angeles home in the 1940s and bought the truck. He called his one-truck delivery business the California Delivery Service. With the profits from his burgeoning delivery service, he bought a fleet of 12 new trucks and hired more drivers. From Dad I learned my first lesson in free enterprise: Truck drivers' wages are higher when they have trucks to drive than when they don't.
Now, the California Delivery Service was not an oil company, and my dad never worked for Exxon, but what CDS did to grow was to invest in labor and make the capital expenditures designed to produce profits and get a good return on investment. It worked then and it works now.
Oil is a global commodity, and its price is set by rising demand and static supply, at least for now. Demand is growing worldwide by emerging markets like China, India, Russia and Brazil, and supply is limited by Malthusian environmental regulations on drilling, no new refining capacity in the last 30 years and the geopolitical risks in Africa, Latin America and the Middle East. The saber-rattling coming out of Iran and Nigeria doesn't help.
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