Now here's the thing. Henry Ford's Model T started rolling of the assembly lines in Detroit in 1908. Since that time, there has been a demand for gasoline. Nothing earth shattering there. So, please look at the graph below and explain to me how from 1908 all the way through 2001 (which is 93 years) gas prices went from nothing up to $1.46 per gallon and from 2001 through 2011 (only 10 years) gas prices went from $1.46 to the current $3.57 per gallon (yearly average prices that is)??? Also, don't forget about the spike of pricing going well over the $4 mark not too long ago!
Now the oil industry people will say the price of crude has gone way up and they would not be wrong. However, since the early 1970's through early 2000's crude prices have stayed in the $27- $30 per barrel price range (give or take a few dollars) and since then they have shot up. Today's price is around $85 per barrel. What the oil guys are not saying is how much more efficient they have become in the refining process! Oh, and not to mention that the oil industry profits have been obscene since 2008. For example, the first quarter 2011 profits posted by Exxon-Mobile were $10.65 Billion. That's right everyone, 10.65 B-I-L-L-I-O-N with a "B" dollars for ONLY THE FIRST QUARTER of this year! In 3 months Exxon-Mobile PROFITED more than most successful companies will have in gross sales over a lifetime!
Profits, after all the silly salaries and expenses, research and development stuff, and all other expenditures the amount left over, at the bottom line, in the pocket, the cheddar was $10,650,000,000.00 in the FIRST 3 MONTHS of this year only! So why are gas prices so high?
Now, I do NOT fault companies for making a profit at all. Exxon-Mobile is not the United Way! They are not working for the betterment of mankind nor should they be. My anger comes from the FACT that in our society you don't have a choice. Now if you live in NY city or LA or DC, etc. there are viable and in fact, more desirable transportation options to the automobile. Hell, just to park in NY costs you more than the car, insurance, gas, and upkeep so it's no wonder why one would use the subway. So, subways, the "L", trains, etc. where they are in place would allow the consumer to say, "I'm not driving" and therefore not use the gas. Then supply and demand could maybe adjust the pricing. However, if you are NOT in one of those major cities and most of us aren't, then you have no option. You must drive!
So before you try to point out other very profitable companies to me, stop and ask yourself are those other profitable companies selling goods/services that are basically REQUIRED to live? If someone has the means to and buys a Ferrari or spends $400 on a Prada wallet, cool. Those are 2 examples of companies that are high end and I would assume have very high profit margins. However, the masses don't have to buy their products to survive. With gasoline, we do. That's my argument.
My last thought is this. Why has no one ever brought up the Sherman Anti-Trust Act in regards to gasoline prices? Look that one up and think about it! I will do another blog with the Sherman Anti-Trust angle to gas prices later. Too much for now! As always, please let me know what you think.
No comments:
Post a Comment