The President calls for a probe

The news that President Bush has done about the only thing he can do with respect to gasoline prices—that is, order an investigation—makes me wonder if we'll ever learn anything. I mean, a typical response to high gas prices is to call for a windfall profits tax on the oil companies. As my friend, Rocky, in San Diego says:

So now comes the perennial march of the demagogues - the search for conspirators, the call for windfall profits tax (as if taxing the companies will lower the price? I never saw the connection), the endless 'pain at the pump' human interest segments on the TV news, pillorying the speculators and oil traders, the oil executives dragged up before some congressional sub-committee or other so the sens and reps can get their sound bites done showing how hard they are on the evil oil execs (nothing ever comes of this), same thing every time the prices go up.

Which got me wondering: do you think that calling for a windfall profits tax is a political maneuver to satisfy the sort of person that believes that corporate taxes are like individual income taxes? I mean, when you or I get a tax increase we do what's possible for us: try to make more money and/or spend less. It seems that there are still those that think that companies work the same way with respect to taxes.

Time for a role-play: I, as the CEO of Big Oil, Inc., promise that any new, federally-mandated windfall profits tax will only come out of my company's obscene, unconscionable profits. Everything else will, and should stay the same: prices of my company's products, salaries of my employees, the number of people we employ, dividends for my stockholders, etc. Big Oil, Inc., would never raise its prices to cover a tax. Never! I promise! Cross my heart and hope to die...

Is the call for a windfall profits tax one of those things that the polls indicate is a smart political move? Gas prices go up so the government should "punish" the evil oil companies by laying another tax on them? I suppose that it's smarter politically than throwing cold water on people's hopes that the oil companies will somehow "suffer". A crass, but effective, play to schadenfreude.

Mightn't the late tobacco settlement have made us realize that even a stupendous court award comes out of the pockets of consumers—in this case, smokers—not the tobacco companies? Are my hopes that people will get the message to be dashed on the shoals of human nature again? Sheesh! You'd think that with a pack of smokes and a gallon of gas costing about the same that people would start to see the connection.

But, no. It's the oil companies' fault! [Full editorial disclosure: I do not own stock in any oil company.] They've got plenty of gelt from their record profits. Lets have the government take some of it. Heck! All of it if they can manage it. Why not? The oil companies make enough money...and on, and on, and on. It's enough to make me gag.

Now, if the guvmint ended any and all corporate subsidies, then we'd be talking....but that still wouldn't make gas prices go down.