Whether or not we went to war for oil in Iraq is missing the point...

ALL wars in the middle east are wrapped up in oil politics at some level. I'm not saying that pejoratively, oil is not some trivial resource, its a national security objective.

We essentially have ONE national security objective in that part of the world, and its securing energy supplies... not just for ourselves, but for the global economy. This is a public good that the US military provides for the rest of the world. Thats why we've had a 50+ year relationship with the Saudis. Oil is the core of our geostrategic interest in the region. There are costs to our plans to secure our free-market access to these resources. One is terrorism, the other is periodic military intervention to protect regional stability.

These are costs that Americans are willing to bear, and should be willing to bear -- because they are not adequately reflected in the costs at the pump. Its an externality to the market. If the external costs are more accurately priced in, we will reach an equillibrium that will lead to less dependence on oil.

Thats the argument. It isn't exactly a radical one, its pretty widely accepted in economic circles.

Ninerfan1 Wrote:[quote="OUGwave"]It has to be enough of a tax for:

1) Consumers to feel the pinch, in order to discourage the use of gas guzzling cars

2) To generate enough revenue to contribute to meaningful technological development.

Thats why I used the words "real gas tax"

Quote:Good idea. While we're at it we need a tax on fatty foods since we know there's a weight problem in America. Maybe an extra $1 or so on hamburgers, hotdogs etc. We also need at least another 1.50 tax on all tobacco products since obviously the american people still aren't getting the message. Perhaps the government should have a tax convention in order to brainstorm ideas of what else it can tax in order to discourage behavior that it has divined is bad for us.

If we have seen anything about America today it's that the government knows what's best for us and should be allowed to "influence" our freedom as much as possible.

Its not a libertarian/big government issue. People have the right to do to themselves whatever they want. But with energy consumption, there are public goods/bads that need to be reflected in the market or you will have tremendously inefficient outcomes.

Quote:How bout this OU. Why don't you and those that think like you voluntarily add say, another 75 cents, to every gallon of gas you buy. Then at tax time just right a check to the government for that amount so they will have it and will be able make some strides in the techological development. I mean you've made it clear you're just not paying enough for gas right now. Seems to me it's your civic duty to voluntarily tax yourself until the government makes it complusory for the rest of us.

You game?

Believe it or not, I don't buy enough gas to have that kind of market power. The idea isn't one of government revenue, its about putting downward pressure on demand. Sadly, I can't do that myself.

Its not about how much money the government gets, its about the market accurately reflecting the costs that oil consumption creates, so that the effects are included in the price. I can lend you some old economics textbooks so you can understand the point better. Send me a PM.

RebelKev Wrote:

fsquid Wrote:That is socialism.

No, that's Fascism.

hmmm, its socialism.

OUGwave Wrote:Thats the argument. It isn't exactly a radical one, its pretty widely accepted in economic circles.

First you'll note I wasn't talking to you in my post about Halliburton. Second the argument I was addressing was a radical one, a radical one from the left. Third I agree with what you said in response regardless.

Quote:Its not a libertarian/big government issue. People have the right to do to themselves whatever they want. But with energy consumption, there are public goods/bads that need to be reflected in the market or you will have tremendously inefficient outcomes.

The government and the market are seperate entities OU, they're not the same. You're proposal is for the government to effect the free market through the use of punitive tax measures. That's very much a libertarian/big government issue. The government using it's ability to tax the people in order to bring about a change that it desires is as big government as it gets.

Quote:Believe it or not, I don't buy enough gas to have that kind of market power. The idea isn't one of government revenue, its about putting downward pressure on demand. Sadly, I can't do that myself.

I see. So you're not willing to even do your small part to attempt to effect change in society, you'd rather the government do it for you. No offense but that's pretty much a cop out on your part. You seek to have the government tax the electorate into compliance with a view you hold, yet you're not willing to freely do to yourself what you seek from the government. You freely admit you don't pay enough for gas, yet you won't, of your own free will, charge yourself a fair price, but you'll lobby for the government to make it compulsory for you.

Quote:Its not about how much money the government gets, its about the market accurately reflecting the costs that oil consumption creates,

And it seems to me you're saying that the market isn't reflecting that therefore the government must, by itself, determine what the fair price is and then apply the appropriate tax in order to set it.

Quote:I can lend you some old economics textbooks so you can understand the point better. Send me a PM.

Thanks but I remember enough from the 9 semester hours of economics I took in college to speak about this. And rest assured I'm pretty well versed on economics and the free market. Most definitely well versed enough to recognize someone advocating governmet setting the price of goods in the market, which is what you are advocating. And I'm very much against it, as any capitalist would be.

aTxTIGER Wrote:

RebelKev Wrote:

fsquid Wrote:That is socialism.

No, that's Fascism.

hmmm, its socialism.

No, it's Fascism. Look up the definition. With Socialism the "State" owns the companies. With Fascism, corporations are allowed to exist, but only at the behest of the "State".

Lesson #1.

Ninerfan1 Wrote:

OUGwave Wrote:Thats the argument. It isn't exactly a radical one, its pretty widely accepted in economic circles.

First you'll note I wasn't talking to you in my post about Halliburton. Second the argument I was addressing was a radical one, a radical one from the left. Third I agree with what you said in response regardless.

Quote:Its not a libertarian/big government issue. People have the right to do to themselves whatever they want. But with energy consumption, there are public goods/bads that need to be reflected in the market or you will have tremendously inefficient outcomes.

The government and the market are seperate entities OU, they're not the same. You're proposal is for the government to effect the free market through the use of punitive tax measures. That's very much a libertarian/big government issue. The government using it's ability to tax the people in order to bring about a change that it desires is as big government as it gets.

Quote:Believe it or not, I don't buy enough gas to have that kind of market power. The idea isn't one of government revenue, its about putting downward pressure on demand. Sadly, I can't do that myself.

I see. So you're not willing to even do your small part to attempt to effect change in society, you'd rather the government do it for you. No offense but that's pretty much a cop out on your part. You seek to have the government tax the electorate into compliance with a view you hold, yet you're not willing to freely do to yourself what you seek from the government. You freely admit you don't pay enough for gas, yet you won't, of your own free will, charge yourself a fair price, but you'll lobby for the government to make it compulsory for you.

Quote:Its not about how much money the government gets, its about the market accurately reflecting the costs that oil consumption creates,

And it seems to me you're saying that the market isn't reflecting that therefore the government must, by itself, determine what the fair price is and then apply the appropriate tax in order to set it.

Quote:I can lend you some old economics textbooks so you can understand the point better. Send me a PM.

Thanks but I remember enough from the 9 semester hours of economics I took in college to speak about this. And rest assured I'm pretty well versed on economics and the free market. Most definitely well versed enough to recognize someone advocating governmet setting the price of goods in the market, which is what you are advocating. And I'm very much against it, as any capitalist would be.

OUGwave explained my point better than I did. And I actually knew Halliburton was a oil services company.

Not sure if taxing oil is the way to go, as it would be government interference in the market, as you mentioned. Perhaps the cost of military action to assure access to and transporation of the oil could be taken out of oil profits somehow. Somehow it should be accounted for, and not just by a general tax on everybody in the US.

NIU007 Wrote:Perhaps the cost of military action to assure access to and transporation of the oil could be taken out of oil profits somehow. Somehow it should be accounted for, and not just by a general tax on everybody in the US.

Again, this presumes that we went to Iraq to secure our energy needs. And the government already takes from oil company profits in the form of taxes on them. In fact the government takes in more in taxes from oil companies than the companies themselves keep.

It should also be noted that the majority of our oil imports are not from the middle east. Canada, Mexico, Saudi Arabia, Venezuela and Nigeria are the main ones. Iraq is below those 5 and does not contribute so much oil that, were it cut off, we could not make up the difference from other countries.

The world has a vested interest in stability in the region. 4 of the top 10 exporting countries are in the Middle East. Now, more than ever, we are in a global economy so our interest in stability there goes far beyond just keeping the oil flowing.

Empowering the government to tax a product up to what it divines is a fair price is about as anti-capitalistic as it gets.

Niner,


At the heart of the matter. How much money we spend on keeping those barrels of oil in the global market is not accounted for in the price of the oil.

As to where we get our oil from........ This is really a moot point. Once that oil hits the open market it affects the price of the oil we get. This new gas station "terror free oil" is really just a sham. All oil in the market dictates the price. If the oil from these threatening regions didn't hit the market the price of oil would go up.

Machiavelli Wrote:Niner,

At the heart of the matter. How much money we spend on keeping those barrels of oil in the global market is not accounted for in the price of the oil.

That's a matter of your opinion Dogger, it is far and away not a fact.

Remove Iraq from the equation Dogger, why don't you break down for me the costs we incur to keep those barrels of oil in the global market. Do we have soldiers in Canda protecting oil fields? In Russia or Mexico?

Quote:As to where we get our oil from........ This is really a moot point.

No, it's really not Dogger. If you're going to argue that we incur so much cost in keeping oil flowing, cost that we are not getting in return, then you have to provide evidence of said costs. And where we import our oil from is the logical first place to start since it is from those places where we would put or money to insure our supply.

Quote:Once that oil hits the open market it affects the price of the oil we get.

As it should. That's they way the free market works. Part of the price the free market sets is based on what it costs to get that oil to the market in the first place. You're arguing that it costs the US more in output of money than it takes back in with taxes. The US government took in over $56 billion dollars in oil and gas taxes last year.

But you can't stop there. You have to factor in taxes collected on the sale of automobiles that use the oil, the taxes paid on the planes that are bought that use the oil, and the taxes collected on the tickets that are bought to fly on the planes that use it. Then there are the ships, the heaters, the trains the construction equipment and all the other items that use the oil and that the government collects taxes on.

You are apparantly agreeing with the opinion that the US spends more to get it to market than it brings back in after it's sold. I'd like you to justify that.

Quote:The world has a vested interest in stability in the region. 4 of the top 10 exporting countries are in the Middle East. Now, more than ever, we are in a global economy so our interest in stability there goes far beyond just keeping the oil flowing.

Empowering the government to tax a product up to what it divines is a fair price is about as anti-capitalistic as it gets.

This is where you lost me. Why does the world have a vested interest in stability in the Middle East? We apparently don't care about all the instability in Africa. Do you happen to know what fraction of the oil on the market currently comes from the Middle East?

NIU007 Wrote:This is where you lost me. Why does the world have a vested interest in stability in the Middle East? We apparently don't care about all the instability in Africa. Do you happen to know what fraction of the oil on the market currently comes from the Middle East?

Of the top 15 oil producing nations 7 are in the Middle East, accounting for around 22 million barrels of oil per day. World consumption of oil is around 84 million per day give or take. So the Middle East accounts for around 26% of the world market.

Given such a high volume of the oil comes from the ME the world has vested interest in stability there.

As far as Africa goes I wouldn't say we don't have concern over the stability there, especially since we have moved to buy more oil from there as opposed to the ME over the last few years. But instability in Africa doesn't necessarily have as much of an impact. I don't believe anyone in Africa has nukes (Pakistan) or has the resources to pursue them (Iran). There's also no Israel smack in the middle of Africa.

Ninerfan1 Wrote:

NIU007 Wrote:This is where you lost me. Why does the world have a vested interest in stability in the Middle East? We apparently don't care about all the instability in Africa. Do you happen to know what fraction of the oil on the market currently comes from the Middle East?

Of the top 15 oil producing nations 7 are in the Middle East, accounting for around 22 million barrels of oil per day. World consumption of oil is around 84 million per day give or take. So the Middle East accounts for around 26% of the world market.

Given such a high volume of the oil comes from the ME the world has vested interest in stability there.

As far as Africa goes I wouldn't say we don't have concern over the stability there, especially since we have moved to buy more oil from there as opposed to the ME over the last few years. But instability in Africa doesn't necessarily have as much of an impact. I don't believe anyone in Africa has nukes (Pakistan) or has the resources to pursue them (Iran). There's also no Israel smack in the middle of Africa.

We rarely send soldiers into Africa or get involved in those areas. A small force into Somalia on a humanitarian mission. We didn't do much of anything when hundreds of thousands were being murdered in Rwanda. But we've installed a Shah, sent weapons to both Iraq and Iran, landed in Saudi Arabia to push Iraq out of Kuwait, and now invaded Iraq and removed the dictator. Many of the African countries, it is true, don't have much capability to produce nukes because they are too busy fighting each other. When Iraq was fighting Iran, neither one had nukes or was close to having them. We pretty much made sure the fighting continued by supporting both sides. The resulting debts that Hussein had with Kuwait (for which the Kuwaitis were demanding repayment) were a major motivator behind the eventual invasion of Kuwait. And I don't remember them talking about nukes when we pushed the Iraqis out of Kuwait. All they had were ineffective scuds.

So far it doesn't look like our interference in the Middle East has resulted in stability. It seems more likely that we are causing our enemies to multiply. At best we've protected the Saudis so we can still get oil from them.

NIU007 Wrote:We rarely send soldiers into Africa or get involved in those areas. A small force into Somalia on a humanitarian mission. We didn't do much of anything when hundreds of thousands were being murdered in Rwanda. But we've installed a Shah, sent weapons to both Iraq and Iran, landed in Saudi Arabia to push Iraq out of Kuwait, and now invaded Iraq and removed the dictator.

Sorry, I'm not catching what your point is.

Quote:So far it doesn't look like our interference in the Middle East has resulted in stability. It seems more likely that we are causing our enemies to multiply. At best we've protected the Saudis so we can still get oil from them.

Stability is a subjective term when you're talking foreign policy.

Ninerfan1 Wrote:

NIU007 Wrote:We rarely send soldiers into Africa or get involved in those areas. A small force into Somalia on a humanitarian mission. We didn't do much of anything when hundreds of thousands were being murdered in Rwanda. But we've installed a Shah, sent weapons to both Iraq and Iran, landed in Saudi Arabia to push Iraq out of Kuwait, and now invaded Iraq and removed the dictator.

Sorry, I'm not catching what your point is.

Quote:So far it doesn't look like our interference in the Middle East has resulted in stability. It seems more likely that we are causing our enemies to multiply. At best we've protected the Saudis so we can still get oil from them.

Stability is a subjective term when you're talking foreign policy.

For the first part, I'm saying that we are meddling in the Middle East in large part because of the oil, not because we're worried about nukes, although now that's a factor too. We want stability there because we want to make sure oil production continues on a steady basis. Otherwise we wouldn't need as much military might in the region, and wouldn't get involved in all the wars over there. Of course we're also trying to help protect Israel from the lunatics.

Yes, stability is just a matter of degree. But it isn't as stable as I would expect after spending so much money and so many lives on Middle East policy.